Trade Deficit Reaches Record High
In April, Canada recorded its largest merchandise trade deficit on record, reaching $7.1 billion—up sharply from $2.3 billion in March.1 This widening gap was driven by a steep 10.8% drop in exports and a 3.5% decline in imports. The appreciation of the Canadian dollar, combined with newly imposed U.S. tariffs on Canadian goods, especially in the automotive sector, further impacted trade values. When measured in U.S. dollars, Canadian exports fell 8.4% and imports dropped 0.9%.
Exports See Steep Decline Across Most Sectors
Merchandise exports fell to $60.4 billion, the lowest level since June 2023 and the sharpest percentage drop in five years. In real (volume) terms, exports declined 9.1%. This marks the third consecutive monthly decline, largely due to a 15.7% decrease in exports to the U.S., following new tariffs. Major declines were seen in motor vehicles and parts (-17.4%), consumer goods (-15.4%), and energy products (-7.9%). However, exports to non-U.S. countries rose by 2.9%.
Imports Down Overall Despite Surge in Gold
Canada’s imports fell by 3.5% in April, with real volumes down 2.9%. Significant declines were observed in motor vehicles and parts (-17.7%), machinery (-9.5%), and consumer goods (-4.2%). These were partially offset by a dramatic increase in imports of unwrought gold and related metals, which surged nearly tenfold to a record $2.7 billion. Without this spike, total imports would have fallen by 6.9%.
US Trade Surplus Narrows, Global Deficit Widens
Canada’s merchandise trade surplus with the United States shrank to $3.6 billion—the lowest since December 2020—as exports fell 15.7% and imports declined 10.8%. Meanwhile, trade with countries other than the U.S. hit a record high, though it resulted in a growing trade deficit. Exports to these countries rose 2.9%, while imports surged 8.3%, pushing Canada’s non-U.S. trade deficit from $9.0 billion in March to $10.7 billion in April.
Industry Trade Breakdown
Farm, fishing and intermediate food products
Exports $5B, down 1.4%
Imports $2.6B, down 6.8%
Basic and industrial chemical, plastic and rubber products
Exports $3B, down 12.7%
Imports $5.3B, down 2.6%
Forestry products and building and packaging materials
Exports $3.4B, down 18.5%
Imports $2.9B, down 8%
Industrial machinery, equipment and parts
Exports $3.7B, down 22.5%
Imports $7.4B, down 9.5%
Electronic and electrical equipment and parts
Exports $2.8B, down 10.6%
Imports $7.7B, down 5.5%
Consumer goods
Exports $7B, down 15.4%
Imports $13.9B, down 4.2%