Canada’s merchandise trade surplus widened to CAD $1.94 billion in August thanks to rising global demand for energy amid shortages in other countries, Statistics Canada reported on Tuesday.
Energy exports rose to the highest level since 2014.
Canada’s merchandise imports fell by 1.4% and merchandise exports rose by 0.8%, helping widen the surplus.
Energy exports, including oil, natural gas and coal, rose to the highest level since 2014 thanks to both climbing global energy prices and higher quantities of exports. When demand in China and South Korea, fueled by their reopening economies, was unmet by the crunch in global energy supply, Canadian energy reaped the benefits.
Exports of metal and nonmetallic mineral products reached record highs as global demand for raw materials used in manufacturing led to an increase in exports.
Imports of motor vehicles and parts, which fell substantially, accounted for the decline in total merchandise imports. Global supply chain issues, most notably the shortage in microchips, had impeded the production of automobiles. Consequently, the trade of motor vehicles and parts suffered.
The trends in August are expected to continue for much of the rest of the year. Canadian energy exports will rise with global demand as the temperature drops. The supply chain issues, which affect trade of transportation equipment, will not be resolved until next year.
Canada’s merchandise trade continues the year’s trend of netting a surplus after years of running a trade deficit.
Import and export trends in August are a good indicator for the rest of the year, with high energy exports and low imports of motor vehicles and parts.
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