Canada's trade deficit up in December; auto sector shows strength
Wednesday, February 10, 2010 at 11:30AM Canada's trade deficit with the rest of the world increased to $246 million in December from $201 million in November, as imports increased more than exports, Statistics Canada reported today. Imports increased 1.8% while exports rose 1.7%, both mainly driven by automotive products.
The value of exports grew to $32.2 billion in December, from $31.7 billion in November, the fourth consecutive monthly gain, with a 2.8% increase in volume accounting for the difference, as prices actually dropped slightly. Two-thirds of the growth was in automotive products, with machinery, equipment and energy products contributing the rest. Exports of industrial goods and materials declined.
Stronger automotive products, parts and passenger car exports to the United States contributed to an overall export increase of 2.9% over November, to $24.1 billion. Automotive products exports grew 8.1% to $4.5 billion in December, with 11.3% increase in volume. Exports of passenger cars increased 11.7%, continuing an upward trend since May, 2009. This pushed Canada's trade surplus with the United States to $3.7 billion, up from $3.4 billion in November. Exports of machinery and equipment grew 3.4% to $6.3 billion, though this gain was the result of higher prices, as volume actually dropped 3.9%. Similarly, energy products exports rose in value, up 1.5% to $7.8billion thanks to a 5.7% price gain, but dropped in volume, down 3.9%.
However, exports to countries other than the United States fell 1.8%, while imports from them increased 1.5%, giving Canada a current trade deficit of $3.9 billion with countries other than the United States.
The increase in imports from $31.9 billion in November to $32.4 billion in December is because of rising volumes (1.1%) and rising costs (0.7%). It was the second consecutive monthly increase. As with exports, automotive products led the gain in imports, accounting for more than half the gain in imports, followed by industrial goods and energy products. Imports of automotive products were up 6.0% to $5.8 billion, while imports of passenger cars grew 3.2%, led by imports from overseas.
Imports of industrial goods and materials, metals and ores, precious metals, and energy products all grew in December, while imports of aircraft and transportation machinery and equipment, as well as communications equipment, declined.
Canada's trade deficit for the year stands at $4.8 billion for 2009.
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