Canada ran a third consecutive trade surplus in May as exports rose to a new record high. This comes despite ongoing trade tensions with the US, which just decided against renewing the Canada-United States-Mexico Agreement (CUSMA), opting for annual reviews. Data showed a big jump in shipments of aluminum to Europe, suggesting diversification efforts away from the US are helping support Canada’s trade activity. Canada’s economy relies heavily on trade, particularly with the US.

• Exports from Canada increased by 0.9% to $77.1 billion in May. This marked a record high for the value of exports. This was the fourth straight increase in exports, which have risen by 22% over that time.
• May’s increase was driven by a rise in shipments of unwrought aluminum and aluminum alloys. Aluminum exports were headed to several countries across Europe. Exports for diamonds, consumer goods and farm products also rose over the month.
• Conversely, exports of energy products declined over the month, due in part to falling oil prices.
• Imports declined by 0.2% in May to $72.9 billion. The decline came amid a drop in gold purchases. Imports had reached a record high in April.
• Canada’s economy posted a trade surplus of $4.24 billion in May, up from the revised $3.41 billion surplus in April, and marked the highest since May 2022.

Trade tensions with the US forced the Canadian government and businesses to find other countries and regions to build and enhance their trading relationship. Trade uncertainty, particularly as it relates to CUSMA, persist. US tariffs continue to hinder certain sectors of Canada’s economy. Still, the economy has demonstrated its resiliency, while the Canadian government continues to build trade relationships.

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