Canada posts surprise $3.2B trade surplus in June as oil exports surge

Canada's trade surplus swung to its widest point since 2008 in June as exports of products like oil surged while imports shrank.

Statistics Canada reported Thursday that exports surged by 8.7 per cent to $53.8 billion. Energy led the way with exports rising by 22 per cent to $11.3 billion. That's the largest amount since March of 2019.

Cars and car parts were also up, by 14.9 per cent, as were metal and non-metallic minerals, which rose by 12.7 per cent.

All in all, Canada exported $4.3 billion more goods and services to the world in June than it did the previous month. That's the biggest monthly increase on record, if 2020's volatile numbers are stripped out.

While Canada was shipping more goods and services to the rest of the world, it was also buying less.

Imports fell one per cent to $50.5 billion as consumer goods fell by 3.7 per cent.

"This category was weighed down by a decline in clothing, footwear and accessories, which Statcan noted was in part due to restrictions in some parts of the country and port disruptions in Asia related to COVID-19 outbreaks," TD Bank economist Rishi Sondhi said.

Imports of cars and car parts, meanwhile, fell by 3.8 per cent.

One type of good that Canada imported a lot more of, however, was vaccines. Imports of vaccines rose by 74.5 per cent in the month to $745 million. That's 21 times higher than the amount of vaccines that Canada was importing the same month a year ago, before the country's COVID-19 vaccination effort ramped up.

U.S. exports surge even more

Almost all of Canada's trade surplus came from dealings with the U.S.

Canada posted a surplus of $8.3 billion with the U.S. for the month. With the rest of the world, however, Canada continues to have a trade deficit, although that deficit shrank to $5.1 billion, resulting in a total trade surplus of $3.2 billion.

"Canada's merchandise trade balance has posted surpluses in four of the first six months of the year, boosted by strong demand arising from U.S. re-openings and the rise in commodity prices," Bank of Montreal economist Shelley Kaushik said.

"Looking ahead, expect imports to recover as the economy reopens, while still-strong energy prices and U.S. growth should continue to support exports."