- Canada’s merchandise exports rose 2.0% (month-on-month) in June, while imports rose 1.7%. As a result, Canada’s merchandise trade surplus with the world increased from $4.8 billion in May to $5.0 billion in June.
- Total exports increased for the sixth consecutive month to $69.9 billion in June. Exports of energy products rose 3.2% to $21.0 billion in June, accounting for 30% of total exports. While energy products played a crucial role in the increase in total exports, non-energy exports also increased by 1.4%.
- Total imports rose 1.7% to $64.9 billion, posting a fifth monthly gain. Imports of energy products (+22.3%) contributed the most to the increase in total imports. Refined petroleum products led the way, rising 32.5% to a record $1.9 billion, driven not only by price growth, but also volume growth.
- Exports to the United States continued to rise, rising 1.2% in June, mainly due to higher crude oil exports. Imports from the United States edged up 2.6%. As a result, Canada’s trade surplus with the United States narrowed from its all-time high of $13.6 billion in May to $13.2 billion in June.
With the departure of the first vessel carrying Ukrainian grain (maize) leaving Odessa, world grain prices are expected to fall from a 40% peak to a record high in March.. There are 16 other full ships queuing to leave Ukraine carrying wheat, sunflower seeds, corn and sunflower oil. The price impacts will stabilize but will remain high. Improving food prices will take time.
Moderation in consumer spending south of the border will hamper prospects for most non-energy commodity exports. As evidenced by the June figures, a decrease in consumer appetite for big spending has resulted from rising inflation and interest rates. Slowing demand in the construction sector also pushed down lumber prices. This should spill over to other sectors such as motor vehicle and parts exports as US households tighten their purse strings and reduce spending.