Canada’s exports rose in May as auto industry production resumed and on higher crude prices, though imports fell on supply challenges tied to the gradual reopening of countries from COVID-19 closures, Statistic Canada said on Thursday.
Total exports rose 6.7 per cent to $34.6 billion in May, its largest jump since January 2014 bouncing back from historic declines in April, and imports declined 3.9 per cent in May to $35.3 billion, the data showed.
“Looks like the worst is behind us, there’s a small rebound and it’s broadly based, which is good news,” said Peter Hall, chief economist at Export Development Canada.
Canada’s trade deficit in May was $677 million, while StatsCan revised April’s trade deficit to $4.3 billion from $3.3 billion. Analysts polled by Reuters had forecast a shortfall of $3 billion in May.
The Canadian dollar turned higher after the release of the data, touching 1.3573 per U.S. dollar, or 73.68 U.S. cents.
Exports of energy products rose 14.5 per cent in May, mainly on higher exports of crude oil, while motor vehicle and parts exports began to ramp up, gaining $822 million.
Despite the monthly increase, exports of motor vehicles and parts were down by almost 80 per cent compared with May 2019, StatsCan said, while the monthly value for crude oil exports was still about one-third of what it was in January.
“Trade is the lifeblood of Canada’s goods sector, but even with exports seeing some improvement in May, we’re still a long way from clearing out the clots that emerged in the coronavirus recession,” Avery Shenfeld, chief economist at CIBC Capital Markets, wrote in a note.
The coronavirus pandemic disrupted global supply chains and forced officials in Canada to shutter non-essential businesses. In recent weeks, regions across Canada have gradually begun to restart their economies.
Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.