Canada trade surplus hits C$2.72B as crude exports fuel record shipments

Canada's trade surplus jumped 55% to C$2.72 billion in April, a 15-month high, as the Iran war inflated crude prices and pushed total exports to a record C$75.16 billion.

"The rise in exports in April wasn't just about energy," said Jocelyn Paquet, senior economist at National Bank of Canada. "Given that the U.S. is the primary destination for our energy exports, it was perhaps not surprising to see Canada's merchandise-trade surplus with its southern neighbour reach its highest level in over a year."

Exports rose 1.6% from March, beating the C$2.55 billion consensus forecast from economists polled by the Wall Street Journal. Energy products led the advance, climbing 9.7% after a 23.4% surge in March, with crude exports up 7.0%. The gains were partly offset by a 17.5% drop in metal and non-metallic mineral products, driven by lower gold shipments to the U.K. Imports edged up 0.3% to a record C$72.44 billion, led by a 16.9% increase in basic and industrial chemical, plastic and rubber products.

The data supports Statistics Canada's flash estimate that gross domestic product grew 0.4% in April, offering a reprieve after two consecutive quarters of marginal contraction that sparked recession talk. The Bank of Canada, which announces its next rate decision Wednesday, is widely expected to hold its benchmark rate at 2.25% for a fifth straight meeting as it balances sluggish growth against the risk that higher energy costs push inflation higher.

Exports to the U.S. rose for a third consecutive month, climbing 4.8% to C$51.98 billion and representing 69.2% of all Canadian trade — the largest share since September 2025. The trade surplus with the U.S. widened to C$9.48 billion, the most since February 2025. Shipments of crude oil, passenger cars and light trucks drove the increase.

Exports to countries other than the U.S. fell 4.8% in April after hitting a record the month before, though shipments to China reached an all-time high of C$3.84 billion. The decline widened Canada's trade deficit with non-U.S. countries as Prime Minister Mark Carney's government pushes to reduce the economy's reliance on the American market.

"The improvement in Canada's terms of trade since the Iran war suggests that the trade surplus should rise further in the coming months," said Ariane Curtis, senior North America economist at Capital Economics. May data should reflect continued energy export growth given global supply shortages, said Stuart Bergman, chief economist at Export Development Canada.

Still, lingering uncertainty over the renegotiation of the U.S.-Mexico-Canada trade agreement may limit upside momentum in the near term, said Andrew Grantham, senior economist at CIBC Capital Markets. "Recent trade data suggest that Canadian exports have largely recovered back to pre-2025 levels, albeit still with some weakness in sectors hit hardest by U.S. tariffs."

This article is for informational purposes only and does not constitute investment advice.