Canada’s trade surplus grew significantly in August, reaching $4.2 billion, as exporters accelerated shipments to the U.S. ahead of new tariffs imposed by President Donald Trump. The surge was driven by an 8.1% increase in exports to the U.S., while imports dropped by 2.5%. Analysts had predicted a smaller surplus of $1.55 billion, following an upwardly revised surplus of $787 million in July.
The tariffs, which took effect on August 22 and affect roughly $20 billion worth of Canadian exports, include products like wine, furniture, dairy, cement, clothing, fishing rods, and hockey equipment. Economists suggest September’s data will provide a clearer picture of the tariffs' impact, including Canadian counter-tariffs on U.S. imports and Trump’s ban on certain goods from Canada.
Overall, Canada’s exports rose by 2.5% in August to $77.91 billion, recovering from a 2.6% decline in July. Energy products, particularly refined petroleum and crude oil, saw the largest gains, increasing by 4.7% to $19.03 billion. Exports of refined petroleum products surged 17.4%, boosted by higher diesel exports to Peru, the U.K., the U.S., and the Netherlands.
Economists noted that refinery outages due to the Russia-Ukraine war and Middle East crisis could further boost Canada’s trade surplus in September, as diesel exports help offset some tariff impacts. The Canadian dollar strengthened slightly after the trade data was released, trading up 0.05% to $1.4250 against the U.S. dollar.