Trade surplus jumps to $3B
Exports rose 9.7 per cent in December to $37.8 billion while imports remained relatively flat, pushing Canada's trade surplus to $3 billion in December.
A 16.5 per cent gain in energy exports was the leading factor, Statistics Canada said. Energy exports rose to $8.6 billion, the third consecutive monthly gain.
Volumes, up 6.6 per cent, increased in most sectors. In dollar terms, prices increased by 2.9 per cent.
The value of imports edged up 0.7 per cent to $34.8 billion. The trade surplus is now at its highest level since February. The $3 billion figure was a reversal of the $115 deficit the country posted in November.
"While the Canadian consumer is still going strong, the sharp divergence in exports versus imports points to a rotation from domestic led economic growth toward export led growth," TD Bank economist Diana Petramala said of the results, in a note.
Energy products exports rose 25.1 per cent to $8.6 billion, the third consecutive monthly gain, with volumes accounting for almost two-thirds of the increase.
But oil was not the only gainer. Exports of industrial goods and materials increased seven per cent to a record high of $10.3 billion, as exports of precious metals and copper ores reached unprecedented levels. Prices in the sector rose 4.5 per cent, while volumes increased 2.4 per cent. Exports of precious metals rose more than 25 per cent during the month and have more than doubled since January 2010. Exports of nickel ores and copper ores also increased in December, reversing large November declines.
Exports of machinery and equipment increased 8.2 per cent to $6.9 billion, as volumes rose 8.6 per cent. Exports of aircraft, engines and parts accounted for over three-quarters of the sector's gain.
Exports of agricultural and fishing products increased 7.6 per cent to $3.5 billion. Gains throughout the sector were led by higher exports of wheat, which have been rising for five consecutive months. Wheat prices have been trending upwards since April 2010.
Forestry products exports rose 9.7 per cent to $2 billion, as volumes increased 10.8 per cent. Exports of wood pulp and other wood products grew to $621 million in December, the highest value since August 2007, reflecting higher demand from China.
Exports to the United States rose 10.8 per cent to $26.7 billion, the highest value since November 2008, while imports were up 2.3 per cent. Consequently, Canada's trade surplus with the United States increased from $3 billion in November to $5.1 billion in December, the largest trade surplus since October 2008.
Exports to countries other than the United States increased 7.3 per cent, the sixth consecutive monthly gain, while imports declined 1.9 per cent. Canada's trade deficit with countries other than the United States declined from $3.1 billion in November to $2.1 billion in December.
"Canada’s trade sector is certainly benefiting from strong global demand for industrial goods and materials and commodities, as strong growth in the U.S. economy has provided a boon to global industrial production," Petramala said.
"That being said exporters still have some challenges to face. In particular, Canadian manufactured goods have had a tough time competing on the international scale, and Canada’s share of world exports has been cut in half over the last decade."