Canadian exports grew 8.1% year-on-year in January

Canadian exports grew 8.1% in January compared to the same month of the previous year, to 51.184 million Canadian dollars.

On the contrary, imports increased 0.9%, to 49,789 million dollars.

Trade is central to the Canadian economy, where one in six jobs is directly linked to exports.

With just 0.5% of the world’s population, Canada accounts for 2.4% (or roughly five times as much) of world trade.

As a result of the results in the imports and exports of Canada, this country had a surplus of 1,404 million Canadian dollars.

It was also the largest surplus since July 2014, according to Statistics Canada.

Canada’s export expansion represented the largest percentage increase since the summer 2020 rebound that followed the easing of restrictions following the first wave of the pandemic.

In particular, Canadian exports of aircraft and other transport equipment and spare parts increased 72.3% in January, mainly due to an atypical growth in aircraft exports, which more than doubled.

A Canadian airline recalled a large number of aircraft from its fleet in January, resulting in the export of these used aircraft to the United States.

Although concentrated Canadian exports like these are unusual for used aircraft, similar shipments are possible in the short and medium term.

Canada Exports

Canada’s economy is characterized by openness, diversification and sophistication, and total trade flows in both directions (imports plus exports) account for about 66% of GDP.

In January 2021, exports of consumer goods increased 11.6%, mainly due to higher exports of goods and miscellaneous supplies.

This category, which includes a wide range of goods, increased by 437 million in January, the largest increase in five years, due to higher exports of gold bars to the United States.

This type of bar, which is retailed to individual investors, is classified within consumer goods, not metallic and non-metallic mineral products, which typically includes gold exports to foreign financial institutions.

The increase in gold bullion exports in January coincided with a higher demand in the United States for this type of investment product.

From the perspective of the Bank of Canada, the global recovery is expected to support exports during 2021 and 2022.

Exports of goods should benefit from stronger external demand, reduced uncertainty related to the pandemic, and improved global investment.

However, the supposed higher level of the loonie will act as a headwind.