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Thursday, November 13, 2003

Canadian international merchandise trade

September 2003 

Merchandise trade rebounded in September, recovering most of the declines experienced in August, largely because of the power blackout in Ontario and the northeastern United States.

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Canadian companies exported $33.7 billion in merchandise in September, up 4.7%. At the same time, imports rose 4.5% to just over $28.0 billion.

As a result, Canada's trade surplus with the rest of the world increased for the third consecutive month, surpassing $5.6 billion. During the past three months, the trade balance has increased by more than $1 billion.

Note to readers

Merchandise trade is one component of the current account of Canada's balance of payments, which also includes trade in services.

"Other OECD countries," mentioned in the text, include Australia, Iceland, Mexico, New Zealand, Norway, Switzerland, Turkey, Poland, South Korea, Hungary, the Czech Republic and Slovakia.


In general, merchandise trade data are revised on an ongoing basis for each month of the current year. Customs basis data are revised for the previous data year each quarter.

Factors influencing revisions include late receipt of import and export documentation, incorrect information on customs forms, replacement of estimates with actual figures, changes in classification of merchandise based on more current information, and changes to seasonal adjustment factors.

Revised data are available in the appropriate CANSIM tables.

The trade surplus with the United States also improved in September, rising from $7.7 billion to just over $8.1 billion, thanks to strong movements in the automotive and forestry sectors.

American companies purchased $27.7 billion in Canadian merchandise, up 4.4%. These exports accounted for 82% of Canada's total. Canada in turn purchased $19.6 billion from the United States, up 4.0%, accounting for about 70% of total imports.

Canada's total non-US trade deficit widened a marginal $95 million in September in spite of increased exports to every major region except the European Union, to which exports fell 10.9%. Canada's trade deficit with countries in the "other OECD country" category narrowed by $305 million in September; this was the only non-US region with which Canada's trade deficit went down.

Canada registered a trade surplus with Japan for the second consecutive month. Exports increased 4.0% to $838 million, while imports climbed 5.1% to $804 million.

On a year-to-date basis, total merchandise exports were 1.4% lower than in the same period of 2002, while imports were down 2.7%.

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Widespread export increases for all sectors

Almost half of the $1.5 billion export jump in September stemmed from increased activity in the automotive sector, in which exports rose 10.4% to more than $7.4 billion. This followed an abnormally low August, due in part to power outages in Ontario and the northeastern United States.

Manufacturers resumed full production, with 2004 model vehicles rolling off assembly lines and heading to dealerships across North America. Passenger auto exports accounted for the majority of the growth, climbing 18.1% to $3.7 billion.

Motor vehicle parts exports grew 5.0% to $2.4 billion and trucks and other motor vehicles inched up 1.0% to $1.3 billion.

All industrial categories increased in September, pushing exports of industrial goods and materials up 4.4% to $5.5 billion. Nickel ore exports returned to more normal levels, following months of labour strikes and production cutbacks during the summer.

Canadians exported $5.1 billion in energy products, a gain of 4.6% from August. Leading the growth was a 7.0% increase in natural gas exports to $2.5 billion, mainly on higher volumes, as prices rose only slightly. Electricity exports more than doubled, from $111 million in August to just under $250 million in September.

Offsetting these gains were lower crude petroleum exports, which slid 9.2% to $1.4 billion, their second consecutive monthly decline. Prices for crude petroleum dipped 3.4%, ending two months of hikes.

Forestry product exports continued their upward trend, rising 5.2% to $3.1 billion. Strong prices, combined with higher volumes attempting to satisfy solid US demand, were responsible for these increases. Lumber exports rose for the fifth consecutive month, up 9.7% in September. Housing starts south of the border continued their torrid pace, as new home purchasers sought to take advantage of low mortgage rates.

Other wood fabricated materials jumped 13.1% to a record level of over $650 million on higher exports of plywood and of oriented strand board. Prices for these materials increased 5.3% in September and 30% in the last four months.

Wheat exports increased $81 million (+29.2%) in September, growing by almost $200 million during the third quarter of 2003. Shipments from Ontario accounted for the majority of this rise, as recent harvests yielded higher-than-usual production. This commodity was the main contributor to the 3.8% improvement for exports in the agricultural and fishing product sector.

Meat and meat preparation exports also surged 46.2%, with exports of Canadian beef to the United States resuming after months of a ban arising from the bovine spongiform encephalopathy (BSE) incident. Shipments began to flow slowly across the border after the United States, along with Mexico and Russia, allowed imports of boneless meat from cattle under 30 months old. There was still a widespread ban on Canadian beef products, including live cattle, and export values in September were lower than before the ban was implemented.

Also contributing to the overall rise in meat exports were large pork product exports, mainly to non-US destinations.

Exports of machinery and equipment edged up 1.2% to $7.4 billion. The largest increases were office machines and equipment (+4.0%) and television, telecommunication and related equipment (+4.9%). Despite these increases, trade in the information technology sector was still below levels witnessed in previous years.

Automotive rebound spurs import growth

Strong automotive activity reversed most of the declines in August. Manufacturers overcame production delays and shutdowns that curtailed output during the summer slowdown, as well as the power outage. Imports in the automotive sector surged by $617 million, or 11.4%. Passenger autos accounted for the bulk of the increase, rising by $330 million, or 22.8%, from the previous month.

Imports of trucks and other motor vehicles climbed 20.9% to $1.1 billion and motor vehicle parts advanced 3.1%, reaching $3.1 billion.

Low inventories and the anticipation of increased winter demand boosted crude petroleum imports 12.9% to $1.2 billion. Prices remained virtually unchanged in September (+0.1%), but have grown 8.4% during the third quarter. Other energy product imports rose 5.1%, led by petroleum and coal products (+6.0%) and coal and other related products (+3.9%).

Machinery and equipment imports edged up 1.6% in September to $8.2 billion. Large imports of drilling machinery, used for the production and extraction of petroleum or gas, led to a 54.9% improvement in this category. Imports of aircraft, engines and parts grew 10.4% to $583 million, while communication and related equipment imports jumped 6.8%.

Imports of industrial goods and materials reached $5.2 billion, a rise of 2.5% in September. Metals and metal ores and chemicals and plastics contributed to this growth, while lower imports of other industrial goods and materials slightly offset these gains.

September's merchandise imports increased for all major sectors except consumer goods, cooling a slight 0.5%, and forestry products, dipping 0.4% to $251 million.

Available on CANSIM: tables 226-0001, 226-0002, 227-0001, 227-0002, 228-0001 to 228-0003 and 228-0033 to 228-0040.

Definitions, data sources and methods: survey numbers, including related surveys, 2201, 2202 and 2203.

The September 2003 issue of Canadian international merchandise trade (65-001-XIB, $15/$151) will be available soon. The publication will include tables by commodity and country on a customs basis. Current account data (which incorporate merchandise trade statistics, service transactions, investment income and transfers) are available quarterly in Canada's balance of international payments (67-001-XIB, $29/$100; 67-001-XPB, $38/$133).

Data for October on Canadian international merchandise trade will be released on December 12.

Merchandise trade data are available in PDF format on the morning of release.

For more information on the publications, contact Jocelyne Elibani, (1-800-294-5583; 613-951-9647). To enquire about the concepts, methods or data quality of this release, contact Matthew MacDonald (613-951-8551), International Trade Division.

Merchandise trade
  August 2003r September 2003 August to September 2003 September 2002 to September 2003 January to September 2002 January to September 2003 January-September 2002 to January-September 2003
  seasonally adjusted, $ current
  $ millions % change $ millions % change
Principal trading partners              
United States 26,566 27,728 4.4 -7.1 259,649 253,576 -2.3
Japan 806 838 4.0 8.7 7,488 7,703 2.9
European Union 2,005 1,787 -10.9 -5.3 17,111 17,607 2.9
Other OECD countries1 841 1,189 41.4 9.8 9,103 9,219 1.3
All other countries 1,958 2,142 9.4 16.7 16,375 17,128 4.6
Total 32,177 33,684 4.7 -4.9 309,724 305,238 -1.4
United States 18,849 19,606 4.0 -9.2 190,790 180,963 -5.2
Japan 765 804 5.1 -22.4 8,668 8,191 -5.5
European Union 2,778 2,948 6.1 -0.7 26,809 26,718 -0.3
Other OECD countries1 1,502 1,545 2.9 -14.7 14,448 14,837 2.7
All other countries 2,944 3,133 6.4 7.1 24,786 27,588 11.3
Total 26,838 28,036 4.5 -7.6 265,501 258,296 -2.7
United States 7,717 8,122 ... ... 68,859 72,613 ...
Japan 41 34 ... ... -1,180 -488 ...
European Union -773 -1,161 ... ... -9,698 -9,111 ...
Other OECD countries1 -661 -356 ... ... -5,345 -5,618 ...
All other countries -986 -991 ... ... -8,411 -10,460 ...
Total 5,338 5,648 ... ... 44,223 46,942 ...
Principal commodity groupings              
Agricultural and fishing products 2,421 2,512 3.8 1.0 23,242 21,701 -6.6
Energy products 4,912 5,140 4.6 11.9 34,859 47,524 36.3
Forestry products 2,932 3,085 5.2 -0.1 28,064 25,786 -8.1
Industrial goods and materials 5,282 5,513 4.4 -5.3 52,781 49,187 -6.8
Machinery and equipment 7,354 7,439 1.2 -9.9 73,040 67,937 -7.0
Automotive products 6,728 7,425 10.4 -11.7 73,743 66,177 -10.3
Other consumer goods 1,410 1,505 6.7 -3.6 13,195 12,986 -1.6
Special transactions trade2 689 601 -12.8 -7.8 5,947 6,000 0.9
Other BOP adjustments 449 464 3.3 -17.4 4,852 7,938 63.6
Agricultural and fishing products 1,734 1,783 2.8 -4.6 16,327 16,355 0.2
Energy products 1,536 1,698 10.5 19.7 11,762 15,113 28.5
Forestry products 252 251 -0.4 -5.6 2,341 2,285 -2.4
Industrial goods and materials 5,073 5,198 2.5 -9.7 51,472 49,062 -4.7
Machinery and equipment 8,036 8,167 1.6 -8.6 79,263 74,402 -6.1
Automotive products 5,412 6,029 11.4 -15.1 60,595 57,426 -5.2
Other consumer goods 3,846 3,827 -0.5 -3.1 34,453 34,850 1.2
Special transactions trade2 452 583 29.0 18.0 4,473 4,148 -7.3
Other BOP adjustments 496 499 0.6 -8.9 4,819 4,651 -3.5
r Revised figures.
1 Includes Australia, Iceland, Mexico, New Zealand, Norway, Switzerland, Turkey, Poland, South Korea, Hungary, Czech Republic and Slovakia.
2 These are mainly low valued transactions, value of repairs to equipment, and goods returned to country of origin.
...Figures not appropriate or not applicable.

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Date Modified: 2003-11-13 Important Notices