Canada’s trade surplus narrowed to C$769 million in July from C$3.9 billion in June, the smallest surplus since February, as total exports fell for the first time in six months.
Exports declined 2.3% to C$76.14 billion, reversing five consecutive monthly gains, while imports increased 2.2% to C$75.37 billion. The decline in exports marked the first drop since January, with economists surveyed by Reuters expecting a surplus of about C$3.2 billion.
Energy products led the export decline, falling 4.4% for a third straight month, driven by a 5.5% drop in crude oil shipments as both prices and volumes decreased. Metal and non-metallic mineral exports also fell 8.5%, partially unwinding June’s 15.8% gain. Excluding energy and metals, exports rose 0.6%.
Aircraft and other transportation equipment exports surged 34.9%, providing the only notable offset to broader weakness. Imports of motor vehicles and parts increased 11.4%, largely sourced from the United States.
Trade with the U.S. weakened sharply, with Canada’s surplus with its largest trading partner falling more than 40% to C$5.9 billion. Exports to the U.S. declined 6.6%, while imports from Washington rose 1.8%. The U.S. accounted for 66.35% of Canada’s exports in July, down from 69.39% in June and 72.64% a year earlier.
Outside North America, exports to non-U.S. markets rose 7.4%, while imports from those regions increased 2.8%, narrowing Canada’s non-U.S. trade deficit to C$5.1 billion from C$6.1 billion in June.
The decline follows the imposition of new 50% U.S. tariffs on some Canadian goods last month, which contributed to the broader softening in bilateral trade flows.
