According to Statistics Canada, Canada's merchandise trade deficit with the world reached $1.1 billion in May, up from a $552 million deficit in April. Imports rose 2.4 percent to $49.8 billion, led by an increase in aircraft imports. Exports were up 1.3 percent to $48.7 billion on account of higher unwrought gold exports.
Canada's trade activity has been strong in recent months, with imports and exports both reaching record highs, resulting in a total trade value of $98.5 billion in May. This represents a 13.8 percent increase over the same month last year.
Total imports rose 2.4 percent in May to $49.8 billion, a sixth consecutive monthly increase. Volumes rose 1.8 percent while prices increased 0.6 percent. Higher imports of aircraft and other transportation equipment and parts, motor vehicles and parts, and energy products were responsible for the increase. Year over year, total imports were up 10.2 percent.
Imports of aircraft and other transportation equipment and parts (+45.9 percent) led the increase, primarily due to aircraft imports, which rose $527 million to $636 million in May. The import of five new airliners in May contributed the most to the growth.
Imports of motor vehicles and parts rose for a fifth consecutive month, up 3.7 percent to a record high $9.8 billion. Imports of motor vehicle engines and motor vehicle parts rose 4.4 percent, coinciding with stronger production and higher exports of motor vehicles in May. Following a 3.1 percent decline in April, imports of passenger cars and light trucks (+3.4 percent) rebounded in May.
Total exports rose 1.3 percent to a record high $48.7 billion in May, a third consecutive monthly gain, on account of higher volumes. Metal and non-metallic mineral products and motor vehicles and parts were the largest contributors to the increase. Exports excluding energy products rose 3.6 percent in May. Year over year, total exports were up 17.8 percent.
Exports of motor vehicles and parts rose 3.6 percent to $8.5 billion in May. Passenger cars and light trucks posted the largest increase, up 3.0 percent to $5.8 billion. This gain coincided with a fourth consecutive monthly increase in imports of motor vehicle engines and motor vehicle parts, and followed some downtime at assembly plants in April.
Imports from the United States rose 3.6 percent to a record high $32.7 billion in May, on higher imports of aircraft and motor vehicles. Exports to the United States edged down 0.3 percent to $36.3 billion. As a result, Canada's trade surplus with the United States narrowed from $4.8 billion in April to $3.5 billion in May. The Canadian dollar fell 0.9 cents US relative to the American dollar from April to May.
Exports to countries other than the United States were up 6.2 percent, mainly on higher exports of unwrought gold to the United Kingdom. Imports from countries other than the United States edged up 0.2 percent, as higher imports from Saudi Arabia (crude oil), China and Belgium were largely offset by lower imports from Germany (passenger cars).
As a result, Canada's trade deficit with countries other than the United States narrowed from $5.3 billion in April to $4.6 billion in May.