(OTTAWA) Canada posted a merchandise trade deficit of 137 million in December, ending a streak of six consecutive monthly surpluses, but the country nonetheless ends 2021 with an annual surplus for the first time since 2014.
Posted yesterday at 2:37 p.m.
December’s result was driven by higher imports and lower exports, Statistics Canada said Tuesday. It follows a surplus of 2.5 billion for the month of November.
For the year as a whole, Canada posted an annual trade surplus of $6.6 billion, its largest since 2008.
December imports rose 3.7% to a record $57.7 billion, fueled by a 16.2% rise in imports of electronic and electrical equipment and parts. Imports of motor vehicles and motor vehicle parts also rose 5.1%.
Meanwhile, exports fell 0.9% to $57.6 billion in December, as exports of energy products fell 5.9%.
Exports of crude oil fell 5.0% on lower prices, while those of coal fell 33.5% due to disruptions in freight transportation in British Columbia following the floods and landslides.
Stephen Brown, senior Canadian economist at Capital Economics, expects to see Canada return to a monthly trade surplus very soon, for two reasons.
“First, the sharp rise in oil prices so far this year will lead to a further recovery in the value of energy exports,” Brown wrote in a report.
“Second, as motor vehicle export volumes were still 13% below their pre-pandemic level in December, while imports were only 4% lower, there appears to be a greater possibility for exports to outpace imports as motor vehicle production rebounds further. »
According to Statistics Canada, Canada’s trade surplus with the United States narrowed to $8.1 billion in December from $9.5 billion in November. Exports to the United States fell 1.4% and imports from the United States rose 2.1%.
Meanwhile, Canada’s trade deficit with countries other than the United States hit a record $8.2 billion in December, up from $7.0 billion in November.
In a separate release, Statistics Canada said the country’s international trade deficit in services rose to 476 million in December, from 256 million in November, as services imports rose 2.3% to 12.2 billion. while exports of services increased by 0.4% to 11.8 billion.
Combining Canada’s international trade in goods and services, exports fell 0.3% to $69.4 billion in December, while imports rose 3.5% to $70 billion, for a trade deficit 613 million in December. In November, this trade balance had ended in a surplus of 2.2 billion.