Canada records surprise trade surplus in September after seven months of deficits

Canada posted a small monthly international trade surplus in September, reversing a trend of seven consecutive months of deficits, data showed on Thursday.

It registered a marginal trade surplus of $153-million in September, following a $6.43-billion deficit in the prior month, Statistics Canada said.

This was the first surplus that Canada has posted since President Donald Trump threatened and later imposed tariffs on critical sectors which choked significant exports to the U.S., Canada’s biggest trading partner. The bulk of the surplus was driven by a 44-per-cent jump in Canada’s trade surplus with the U.S., Statscan’s data showed.

The September trade data, which was due in November, was delayed as information for Canadian exports to the U.S. were unavailable due to a 43-day government shutdown in the U.S.

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Analysts polled by Reuters had forecast the trade deficit at $4.5-billion for September. Economists said the trade numbers show that Canada’s international merchandise trade was finally starting to normalize.

“Overall story is really positive,” said Prince Owusu, senior economist with Export Development Canada.

“It seems to suggest that the trade flow with the United States is beginning to stabilize,” he said, adding that the trend of diversification from the U.S. that started is also continuing.

Canada’s total exports in September grew by 6.3 per cent to $64.23-billion, rebounding from a drop of 3.2 per cent in August, and was driven by higher exports in nine out of 11 product sections. This was the largest percentage increase since February, 2024. This was led by U.S. exports that grew by 4.6 per cent and exports to countries other than the U.S. growing by 11 per cent, Statscan said.

Exports of metal and non-metallic mineral products and aircraft and transportation equipment and parts led the gains with over 20-per-cent rise in exports. In volume terms, total exports rose 4.1 per cent, the statistics agency said. Total merchandise imports dropped by 4.1 per cent in September to $64.08-billion.

Exports to the U.S. grew by 4.6 per cent in September to $45.84-billion, helped by outbound shipments of aircraft, light trucks and unwrought gold, Statscan said.

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Exports to the U.S. grew to $45.84-billion from $43.83-billion in August, helped by outbound shipments of aircraft, light trucks and unwrought gold, Statscan said.

The U.S. accounted for over 71 per cent of Canada’s exports in September. Imports from the U.S. declined 1.7 per cent in September, a third consecutive monthly decrease, taking Canada’s trade surplus with the U.S. to its highest level since February.

Higher shipments of unwrought gold, crude oil and aircraft led the jump in exports to countries other than the U.S. Imports from countries other than the U.S. dropped 7.3 per cent. Canada’s trade deficit with countries other than the United States has narrowed sharply, posting the lowest deficit since October, 2024, Statscan said.

The Canadian dollar firmed in early trade and was trading up 0.2 per cent to 1.3767 to the U.S. dollar, or 72.64 U.S. cents. Yields on the two-year government bonds were down 0.2 basis points to 2.524 per cent.