A truck carries a cargo container at the Port of Vancouver Centerm container terminal in Vancouver, on Friday, October 14, 2022. THE CANADIAN PRESS/Darryl Dyck DD
In March, Statistics Canada reported that Canada experienced a merchandise trade deficit of $2.3 billion, marking its largest deficit since June of the previous year. This news contrasts sharply with February's surplus of $476 million, which had initially been reported as $1.4 billion before revisions were made.
CIBC senior economist Katherine Judge expressed surprise at the March figure, which deviated significantly from expectations of a $1.2 billion surplus. Judge noted that this unexpected deficit, coupled with downward revisions to the February data, suggests that net trade could have a modestly negative impact on economic growth in the first quarter.
Statistics Canada attributed the decline in total exports in March to a 5.3% decrease to $62.6 billion. Notably, exports of unwrought gold, which had surged to a record high in February, returned to normal levels. The agency pointed out that the large number of high-value unwrought gold shipments to the United Kingdom and Switzerland seen in February did not recur in March. Additionally, exports of metal and non-metallic mineral products fell by 17.4% in March, primarily due to decreases in exports of unwrought gold, silver, platinum group metals, and their alloys, which declined by 32.5%.
Energy product exports also saw a decline of 4.9% in March, partly due to reduced exports of crude oil and bitumen, coinciding with unplanned refinery shutdowns in the U.S. Midwest. Similarly, exports of motor vehicles and parts decreased by 6.3% in March, as several manufacturing plants undertook retooling work on assembly lines to accommodate new vehicle models.
On the import side, total imports decreased by 1.2% to $64.8 billion in March. Imports of electronic and electrical equipment and parts experienced the most significant decline, falling by 8.1%. Similarly, imports of metal ores and non-metallic minerals dropped by 29.2%, reaching their lowest level since September 2021.
In terms of volume, total exports fell by 4.7%, while total imports decreased by 1.2% in March.
In a separate report, Statistics Canada revealed that Canada's international trade in services incurred a deficit of $1.0 billion in March, widening from $900 million in February. This was primarily due to a 2.0% decrease in service exports, which totaled $16.9 billion, and a 1.4% decline in service imports, amounting to $17.9 billion.
When combining Canada's international trade in goods and services, Statistics Canada reported a total trade deficit of $3.3 billion in March, a significant increase from February's deficit of $431 million.
