Statistics Canada reports merchandise trade deficit $160 million in December

OTTAWA –

Canada posted a merchandise trade deficit of $160 million in December as both exports and imports fell compared with November, Statistics Canada said Tuesday.

The result followed a revised deficit of $219 million for November compared with an initial reading for the month that showed a $41 million deficit.

BMO Capital Markets economist Shelly Kaushik said December was the second straight deficit, as lower energy prices weighed on exports.

“However, real trade flows were more encouraging, and suggest that trade will add meaningfully to fourth-quarter growth,” Kaushik wrote in a report.

Statistics Canada said exports in December fell 1.2 per cent in the month to $63.0 billion. Energy exports fell 7.6 per cent to $14.3 billion, while exports of farm, fishing and intermediate food products dropped 9.9 per cent to $5.3 billion.

Meanwhile, imports dropped 1.3 per cent in December to $63.1 billion as imports of consumer goods fell 6.4 per cent to $12.1 billion and motor vehicles and parts dropped 6.0 per cent to $9.9 billion.

In volume terms, total exports in December rose 0.9 per cent, while import volumes fell 1.9 per cent.

Statistics Canada said Canada’s trade deficit with countries other than the U.S. was $7.1 billion in December compared with $7.3 billion in November as imports from countries other than the U.S. fell 3.8 per cent, but exports to those same countries dropped 4.5 per cent.

Meanwhile, Canada’s merchandise trade surplus with the U.S. was $7.0 billion in December compared with $7.1 billion in November as exports to the U.S. fell 0.1 per cent and imports rose 0.2 per cent.

For the whole of 2022, Statistics Canada said the country posted a merchandise trade surplus of $20.1 billion, up from a surplus of $4.6 billion in 2021.

In a separate report, the agency said Canada’s international trade in services deficit was $1.2 billion in December compared with $1.4 billion in November.

Exports of services rose 1.1 per cent to $14.2 billion, while imports of services was down 0.6 per cent at $15.4 billion.

When international trade in goods and services were combined, Statistics Canada said the country’s trade deficit with the world was $1.3 billion in December compared with $1.6 billion in November.

This report by The Canadian Press was first published Feb. 7, 2023