The Canadian economy achieved a trade surplus for the first time since the U.S. trade war began, as exports rebounded and imports fell in September, according to Statistics Canada.
The agency adds that export to countries other than the United States rose sharply by 11 per cent in the same month — and that while exports to the U.S. increased, imports from there dropped.
“Exports to the United States were up 4.6 per cent in September, partly due to higher exports of aircraft, light trucks and unwrought gold,” Statistics Canada noted.
“Meanwhile, imports from the United States declined 1.7 per cent in September, a third consecutive monthly decrease.”
Canada saw its total exports climb 6.3 per cent in September compared with August as imports fell 4.1 per cent. Compared with a year ago, September saw total exports climb 0.3 per cent, while total imports fell 1.9 per cent.
Statistics Canada says the economy saw a “slight” trade surplus of $153 million in September, following August’s $6.4-billion deficit, and a $3.8-billion deficit in July.
A trade surplus happens when the value of goods and services exported is greater than the value of those imported — similar to when a company makes a profit on what it produces.
When the opposite occurs, and an economy imports more than it exports, it’s considered a trade deficit.
“Overall story is really positive,” said Prince Owusu, senior economist with Export Development Canada, to Reuters.
“It seems to suggest that the trade flow with the United States is beginning to stabilize,” he said, adding that the trend of diversification from the U.S. is also continuing.
Prime Minister Mark Carney has been working to steer Canada’s economy away from the United States as its number one trading partner in order to reduce the impact of tariffs and the uncertainty of the trade war. This has meant finding alternative trading partners and investing in new projects while expanding various resource sectors to meet the demand.
It may not be just the added cost and uncertainty that is influencing this shift away from the U.S. as Canada’s main trading partner, it may also be sentiments of everyday Canadians.
Consumers’ sense of patriotism is fuelling the “Buy Canadian” movement, while they are also avoiding products made in or sourced from the U.S.
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An Ipsos poll released during the summer, and conducted exclusively for Global News, found that 72 per cent of Canadian respondents were actively avoiding U.S.-made goods, and a separate poll released in September found six in 10 said they could never trust the U.S. the same way again.
Statistics Canada says August’s increase in exports was the largest since February 2024, with gains seen in nine out of 11 sectors.
The largest exports were seen in metal and non-metallic mineral products, particularly from raw gold, as well as silver and platinum group metals and alloys.
Most of these raw metals were shipped to customers in Switzerland, the United States and the United Kingdom.
Trump’s tariff policies have hit Canada’s aluminum and steel sector hard, with a 50 per cent duty placed on all of these imports from other countries. This has led U.S. businesses to reduce their orders of Canadian goods, like aluminum, to avoid higher costs.
Overall exports of raw aluminum and aluminum alloys were down 16.7 per cent in September compared with a year earlier.
Still, Canada’s aluminum industry managed to increase its exports to other countries, like the Netherlands and Italy.
Crude or raw oil exports were up 5.8 per cent in September, which was the fifth straight monthly gain in export value for the sector.
Germany especially bought more Canadian crude oil in September, which the agency says contributed the most to the sector’s growth in the month.
Singapore was also highlighted as a top-three trading partner in September by Statistics Canada, mainly due to the country buying crude oil and aircraft products.
Statistics Canada says exports of aircraft to other countries spiked 72.3 per cent in September, and the United States was the biggest customer of Canadian-made private jets. The agency adds that these exports tend to rise in the last month of a quarter, which was the case for September, but this year, “they rose more than they typically do.”
Overall, exports to the U.S. climbed 4.6 per cent in September compared with August, led by these aircraft products as well as raw gold, while imports from the U.S. declined 1.7 per cent — the third straight monthly drop.
Compared with a year earlier, Canadian exports to the U.S. were still down 5.6 per cent in September, while imports from the U.S. were down 8.2 per cent.
China was also highlighted as one of the main countries Canada imported less product from, which fell 11.3 per cent in September compared with August, and down 5.4 per cent from a year earlier.
Nathan Janzen, assistant chief economist at Royal Bank of Canada, said after reading Thursday’s report from Statistics Canada that he’s “cautiously optimistic” about Canada’s economic positioning right now.
“Uncertainty about Canada’s future trade relationship with the U.S. remains, slower population growth will weigh on aggregate output, and weak productivity growth persists as a structural challenge,” Janzen said in a statement.
“But absent another external shock, we (Royal Bank of Canada) remain cautiously optimistic about the Canadian economic outlook in the year ahead and don’t expect the Bank of Canada will need to lower interest rates further.”
The Bank of Canada held its key interest rate at 2.25 per cent on Wednesday, saying borrowing rates in Canada were “at about the right level” to stimulate the economy while keeping prices relatively stable.
— with a file from Reuters
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