Canada's international merchandise exports rose 1.5% in October
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s a result, Canada's merchandise trade surplus with the world widened from $607 million in September to $1.2 billion in October.
In October, the average value of the Canadian dollar decreased 2.1 cents US compared with the average value in September, falling to 73.0 cents US, its lowest level since May 2020. When expressed in US dollars, Canadian exports were down 1.3% in October, and imports decreased 2.2%.
The value of the Canadian dollar rose 1.4 cents US in November, which will have a downward effect on trade values for that reference month.
Total exports rose 1.5% to $67.0 billion in October. Gains were observed in 8 of the 11 product sections. In real (or volume) terms, total exports edged up 0.1% in October, while export prices rose for the first time in five months.
Exports of consumer goods (+9.7%) were the largest contributor to the overall increase in exports in October.
Pharmaceutical products (+20.7%) contributed the most to the gain, led by higher exports of medicinal products to the United States. After falling 36.7% from June to September, exports of miscellaneous goods and supplies rebounded in October (+ 30.7%), mainly on higher exports of gold bars and coins to the United States.
For a second consecutive month, exports of farm, fishing and intermediate food products rose sharply, increasing 10.2% in October to a record-high $5.5 billion. Exports of canola (+73.8%) and wheat (+18.0%) were once again mainly responsible for the increase.
Owing to elevated production in the most recent crop year, larger quantities of wheat and canola became available for export. This comes amid strong global demand and high prices for these products.
Exports of aircraft and other transportation equipment and parts advanced 17.5% to $2.4 billion in October, the highest level observed since January 2021. Aircraft exports were the main contributor to the growth, led by higher exports of private jets and commercial airliners to the United States.
After falling 9.3% in September, exports of metal ores and non-metallic minerals increased 13.0% to a record-high $3.1 billion in October.
Potash exports (+15.4%) were largely responsible for the monthly variations in this product section for the past two months. In October, significant growth in exports of potash to Bangladesh was observed.
Challenging weather conditions for farmers abroad and the conflict in Ukraine have contributed to the recent increase in global demand for Canadian fertilizers. Compared with October 2021, Canadian potash exports have more than doubled.
Lower exports of metal and non-metallic mineral products (-15.0%) offset much of the gain in exports in October.
Exports of unwrought gold, silver and platinum group metals (-41.4%) were mostly responsible for the decrease in October, led by a decline in gold asset transfers and deliveries of refined gold to the United Kingdom, Hong Kong and Switzerland.
Exports of unwrought gold, silver and platinum group metals had previously risen by almost 70% from April to September.
Total imports were up 0.6% to $65.8 billion in October, with increases observed in 6 of the 11 product sections. However, in real (or volume) terms, total imports decreased 0.9%, a second consecutive monthly decline.
Imports of motor vehicles and parts (+4.6%) posted the largest increase in October, driven by higher imports of passenger cars and light trucks (+6.3%). In October, higher imports of light trucks from the United States were observed.
The decline in the exchange rate also contributed to the higher import values for passenger cars and light trucks in October.
Imports of metal and non-metallic mineral products rose 6.5% in October. The largest increase was observed in imports of unwrought gold, silver and platinum group metals (+20.6%), mainly because of higher transfers of gold assets from the United States.
Imports of nickel also contributed to the growth, owing to high value shipments from Finland that took place in the month.
After posting an 18.8% decrease in September, imports of energy products were up 8.4% in October. Crude oil imports (+9.4%) posted their first gain since June, driven by increased deliveries from the United States.
Imports of refined petroleum products (+8.1%) also rose in October, due in part to higher imports of aviation fuel from India and the United States.
Many product sections also posted considerable declines in October, thereby partially offsetting these increases. They included imports of basic and industrial chemical, plastic and rubber products (-6.4%), consumer goods (-2.0%), metal ores and non-metallic minerals (-12.5%), and electronic and electrical equipment and parts (-2.6%).
Exports to countries other than the United States increased 2.2% in October, led by higher exports to China, South Korea and Italy. Exports to China sharply increased by 25.4% to a record-high $3.3 billion, driven by higher exports of canola, oilseeds and wheat.
Lower exports to the United Kingdom and Hong Kong offset a large part of these gains, primarily because of a decline in gold deliveries to these countries.
In October, imports from countries other than the United States were up 1.8%. The strongest increases were observed in imports from Belgium (pharmaceutical products) and South Korea (various products). Meanwhile, imports from China (various products) fell 3.7%.
Canada's trade deficit with countries other than the United States widened slightly from $8.7 billion in September to $8.8 billion in October.
Exports to the United States increased 1.3% in October, while imports from that country edged down 0.1%. As a result, after four consecutive monthly decreases, the merchandise trade surplus with the United States widened from $9.3 billion in September to $10.0 billion in October.
Imports in September, originally reported at $65.2 billion in the previous release, were revised to $65.4 billion in the release for the current reference month. Exports in September, originally reported at $66.4 billion in the previous release, were revised to $66.0 billion in the current reference month's release.
In October, monthly service exports were up 1.6% to $13.9 billion. Meanwhile, service imports rose 2.0% to $15.8 billion.
When international trade in goods and services were combined, exports increased 1.5% to $80.9 billion in October, while imports were up 0.9% to $81.7 billion. As a result, Canada's trade deficit with the world went from $1.2 billion in September to $726 million in October. ■