New data show both imports and exports with US fall as Canada expands trading relationships with other countries.
Canada’s trade with the United States has tumbled in March, but a surge in exports to other countries have helped make up the downward shift.
Exports to the US dropped by 6.6 percent during the month while imports from the US fell by 2.9 percent amid growing public discontent towards Canada’s longstanding ally and top trading partner, according to data released by Statistics Canada on Tuesday.
Total exports fell by 0.2 percent in March mainly on lower prices whereas imports tumbled by 1.5 percent.
Canada’s trade deficit shrank from 1 billion Canadian dollars (US$1.4bn) in February to 367 million Canadian dollars (US$506m) in March. Its trade surplus with the US fell to 6.1 billion Canadian dollars (US$8.4bn) .
“This decline was almost entirely offset by a significant rise in exports to countries other than the United States,” the agency said, highlighting a 24.8 percent surge in overseas shipments. Canada increased exports of gold to the United Kingdom, crude oil to the Netherlands and various goods to Germany.
Exports of motor vehicles and parts also increased amid US tariffs targeting the auto sector. Exports of pharmaceuticals and uranium to the US as well as pork to Asian markets declined. Natural gas exports also fell.
Steel exports dropped while aluminium exports rose for a fourth straight month. Imports of steel declined, but imports of aluminium grew as both products face 25 percent US tariffs.
Analysts have warned that the full effects of the tariffs have yet to be seen. Canada should “brace for increasing headwinds to trade as the worst of the trade conflict is expected to take place over the coming quarters”, TD Economics analyst Marc Ercolao said in a research note.
Carney and Trump meet
The trade data was released the day Canadian Prime Minister Mark Carney met with US President Donald Trump in Washington, DC, to discuss strained trade and security ties.
Carney won last week’s elections on a pledge to stand up to Trump and his America First agenda. He said the strained relationship between the two countries can never be the same again.
The US imposed broad tariffs on Canadian goods at the beginning of March before announcing several reductions and exemptions even as tariffs on cars, aluminium, steel and potash stayed in place. Canada has hit back with countermeasures.
“Canada and the United States are strongest when we work together – and that work starts now,” Carney said on the social media platform X as he arrived in Washington, DC, on Monday night.
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