Canada International Trade (Apr. 2026)

Strength in exports not just an oil price story

The improvement in Canada’s goods trade balance bodes well for GDP growth at the start of the second quarter. While higher oil prices continued to support energy exports, the strength was also due to a broad-based rise in export volumes. And the improvement in Canada’s terms of trade since the Iran War suggests that the trade surplus should rise further in the coming months.

The widening of the goods trade balance to $2.7bn in April, from $1.8bn in March, was broadly in line with expectations and brought the surplus to its highest level since January 2025. The 1.6% m/m rise in export values was partly driven by a price-related 9.7% m/m rise in energy exports. Exports of most other product categories rose as well, particularly aircraft and transportation equipment (+13.8% m/m) as well as industrial machinery, equipment and parts (+9.6% m/m). A surge in wheat shipments to China, likely due to the easing of Chinese import restrictions, helped farm, fishing and intermediate food exports rise by 8.9% m/m to reach their highest level in over a year. The biggest drag on exports was a 17.5% m/m fall in metal and non-metallic mineral exports. But as in previous months, the large swing was driven by changes in gold exports to the UK. Meanwhile, imports rose by a more muted 0.3% m/m. That was partly driven by a large jump in chemical, plastic and rubber products, while imports of the more consumer-facing products were mixed.

Even accounting for the rise in oil prices, in real terms net trade still improved significantly, as the 3.0% m/m rise in export volumes more than offset the 0.4% m/m rise in imports. Altogether, the trade data appear to be consistent with the flash April estimate of a strong 0.4% m/m rise in GDP.