Canada Records Largest Merchandise Trade Deficit in April

Canada experienced its largest merchandise trade deficit on record in April, totaling $7.1 billion. This significant deficit was primarily driven by a sharp decline in exports, attributed to U.S. tariffs imposed during the month.

According to Statistics Canada’s report released on Thursday, April’s deficit followed a $2.3 billion deficit in March. The overall exports plummeted by 10.8 percent to $60.4 billion in April, marking the lowest level since June 2023. This decline was particularly notable in the motor vehicle and parts sector, which saw a 17.4 percent drop in exports. Consumer goods exports also fell by 15.4 percent, while energy products exports decreased by 7.9 percent.

On the other hand, total imports also saw a decline of 3.5 percent in April, amounting to $67.6 billion. Imports of motor vehicles and parts experienced the most significant decrease at 17.7 percent, followed by industrial machinery, equipment, and parts which dropped by 9.5 percent.

When considering real or volume terms, total exports fell by 9.1 percent in April, while imports decreased by 2.9 percent during the same period.

Canada managed to maintain a merchandise trade surplus with the U.S. of $3.6 billion in April, the smallest surplus with its largest trading partner since December 2020. This surplus was achieved despite a 15.7 percent decline in exports to the U.S. and a 10.8 percent drop in imports from the U.S.

However, Canada’s trade deficit with other countries widened to $10.7 billion in April compared to $9 billion in March. Exports to countries other than the U.S. increased by 2.9 percent to $18.3 billion, while imports from non-U.S. countries surged by 8.3 percent, reaching a record $29 billion.