(OTTAWA) Canada’s trade deficit widened to $3.4 billion in May as imports of unwrought silver soared and lower oil prices weighed on exports, Statistics Canada said Thursday. .
It was thus the largest trade deficit recorded by the country since October 2020, and it compared with a revised surplus of 894 million for the month of April, underlined the federal agency.
TD Bank economist Marc Ercolao noted that while the report appeared to be on a broader downtrend in May, crude oil export activity is expected to rebound in June as oil production in Alberta having come back online after the forest fires.
“Looking ahead, the British Columbia ports strike, now entering its sixth day and affecting more than 7,000 workers, is likely to put a damper on July trade numbers as the affected ports in the west coast handle a quarter of Canada’s international trade,” Mr. Ercolao wrote in a report.
Overall, Statistics Canada said exports fell 3.8% to $61.5 billion in May, as exports of energy products fell 7.3%, largely due to price drop. Crude oil exports fell 8.3% and coal exports plunged 14.5%.
Exports of agricultural and fishing products and intermediate food products also fell 13.4% for the month.
Meanwhile, imports rose 3.0% in May to $65 billion, as imports of metal and non-metallic mineral products rose 12.3%, helped by larger shipments of silver under UK raw form.
Imports of motor vehicles and motor vehicle parts rose 4.5% in May to a record $11.3 billion, with imports of engines and parts up 6.9% and motor cars and light trucks, 4.6%.
Expressed in volume terms, overall exports fell 2.5% in May, while imports rose 3.5%.
Regionally, Statistics Canada noted that the country’s trade surplus with the United States narrowed to 6.7 billion in May, from 8.7 billion in April. Exports to the United States fell 2.9% and imports from Canada’s largest trading partner rose 1.3%.
Canada’s merchandise trade deficit with countries other than the United States was $10.2 billion in May, down from $7.8 billion in April.
In a separate report, Statistics Canada said the international trade deficit in services reached $1.1 billion in May, from $1.2 billion in April, as services imports fell 0.5% and services exports remained virtually unchanged.
Canada’s trade balance, when the country’s trade in goods and services are combined, ended in a deficit of $4.6 billion in May, compared to a deficit of $316 million in April.