• Prior was -3.65B (revised to -$4.18B)
• Exports 66.31B vs 62.488B prior
• Imports 72.05B vs 66.13B prior

Canada’s merchandise trade activity increased sharply, with imports rising 8.4% and exports increasing 6.4%.

There were some big swings in gold that made this report look worse than it was. Excluding unwrought gold, silver, and platinum group metals, and their alloys—a product group largely composed of unwrought gold—imports rose 5.8%, while exports were up 5.5%.

The other thing skewing this data (and yesterday’s Canadian data) was auto production shutdowns that extended into January then rebounded in February. As a result, imports of motor vehicle engines and motor vehicle parts rose +7.5%.

There is going to be a big improvement in March given the jump in oil prices.

Statistics Canada publishes monthly international merchandise trade data on a balance-of-payments basis, covering goods exports and imports by product and trading partner. The United States remains by far Canada’s largest trading partner, though the U.S. share of Canadian exports slipped from 75.9% in 2024 to 71.7% in 2025 as trade with non-U.S. destinations—particularly for energy and metals—expanded. Canada also publishes a combined goods-and-services trade balance, drawing on a separate monthly services trade survey.

Canada’s trade position deteriorated steadily through 2025. The annual merchandise deficit widened to C$31.3 billion, the largest since 2020, up sharply from C$7.2 billion in 2024. The surplus with the United States shrank from C$101.3 billion to C$81.6 billion, while the deficit with non-U.S. countries widened to C$112.9 billion. Monthly results were volatile, swinging from a C$6.4 billion deficit in August to a near-balanced position in September before slipping back to deficits of C$2.2 billion in November and C$1.3 billion in December.

January 2026 brought a sharp deterioration. The merchandise trade deficit widened to C$3.6 billion from C$1.3 billion in December, well above the C$0.9 billion consensus. Exports fell 4.7%, the largest monthly decline since April 2025, dragged down by a 21.2% plunge in motor vehicle and parts shipments to their lowest level since September 2021, as prolonged production stoppages for model changeovers disrupted passenger car exports. Aircraft shipments also reversed a strong December. Energy exports provided a partial offset, with natural gas up 23.7%. Imports declined a more modest 1.1%. Including services, the total trade deficit widened to C$3.8 billion. Canada’s surplus with the U.S. narrowed to C$5.3 billion, while the deficit with non-U.S. partners widened to C$9 billion. The February trade report is scheduled for release today, April 2.

This article was written by Adam Button at investinglive.com.