Canadian international merchandise trade: Annual review

Canada's international merchandise trade was significantly affected by the decline of the global economy in 2009. The largest decreases in exports and imports occurred mostly in the first quarter of the year. Canada exported $369.7 billion of merchandise to the world, down 24.5% from 2008. During the same period, imports fell 15.5% to $374.2 billion.

As a result, the trade balance went from a surplus of $46.9 billion in 2008 to a deficit of $4.5 billion in 2009, the first deficit since 1975. Canada's trade balance with the world has been declining since 2004.

The nation's trade surplus with the United States fell from $89.1 billion in 2008 to $34.8 billion in 2009, the lowest level since 1997, while the trade deficit with countries other than the United States narrowed to $39.3 billion in 2009 from $42.2 billion in 2008.

Canada's trade with the United States continues to decline

In 2009, the United States represented 63.0% of Canada's total merchandise trade (exports and imports combined), down from 65.7% in 2008 and 71.1% in 2005.

Exports to the United States declined 28.2% to $269.5 billion, led by falling prices of energy products and lower demand for automotive products. Imports fell 17.8% to $186.7 billion, reflecting the weakness of automotive product imports.

For the first time, countries other than the United States accounted for one quarter of Canada's exports, up from 16.2% in 2005. The rise in the share occurred despite exports to these countries declining 16.9% in 2009.

Canada's exports to Europe fell 18.9% to $32.3 billion. While the decrease was widespread across the continent, Norway, the Netherlands, Belgium Germany and the United Kingdom accounted for almost 60% of the drop. Contributing to the decline were lower exports of nickel ores to Norway and the United Kingdom, as well as lower exports of petroleum and coal to France and the Netherlands. In contrast, an increase in exports of precious metals, mainly gold, to the United Kingdom moderated the overall decline in Canada's exports to Europe.

China replaced Japan as Canada's third largest country of destination, behind the United States and the United Kingdom. Exports to China, which have been growing for the past seven years, increased 6.6% to $11.2 billion, fuelled by strong exports of canola, iron ores as well as coal and other bituminous substances. Canada's exports to Japan declined by 25.0% to their lowest level since 2003.

Similarly, imports from countries other than the United States fell for the first time in eight years. Even with the declines, the share of imports from these countries rose to 48.8% in 2009 from 43.5% in 2005.

Imports from Europe declined to $55.5 billion, largely due to a drop in imports of crude petroleum from the United Kingdom and Norway.

Canada imported $39.7 billion worth of merchandise from China, down 7.0% from 2008. The decrease mainly resulted from lower imports of computers as well as games and toys. Softening the fall were gains in imports of telecommunication equipment.

Available on CANSIM: tables 228-0001 to 228-0003, 228-0033, 228-0034, 228-0041 to 228-0043 and 228-0047 to 228-0057.

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

The publication International Merchandise Trade Annual Review, 2009 (65-208-X, free), is now available online from the Key resource module of our website under Publications.

Data on Canadian international merchandise trade for February will be released on April 13.

For more information, contact Sharon Nevins (toll-free 1-800-294-5583; 613-951-9798; trade@statcan.gc.ca). To enquire about the concepts, methods or data quality of this release, contact Mychèle Gagnon (613-951-0994), International Trade Division.