Canadian exports heading to the United States continued to dry up in May as trade picked up with other nations, Statistics Canada said Thursday.
The agency said Canada's merchandise trade deficit narrowed to $5.9 billion in May as gold exports climbed higher.
The result compares with a trade deficit of $7.6 billion seen in April — a record high, which StatCan said Thursday was revised up from initial estimates of $7.1 billion.
Canadian exports got a boost in the early part of 2025 as businesses rushed to get ahead of U.S. tariffs, but that pull-forward has left weaker activity in April and May. After a relatively strong start to the year, real gross domestic product figures from StatCan show a 0.1 per cent decline in April and early estimates for the same decline in May.
Excluding the bump from metal and non-metallic mineral products, total exports fell 1.2 per cent in May as exports to the United States dropped 0.9 per cent.
StatCan said U.S. exports declined for the fourth consecutive month in May amid the ongoing trade dispute. Imports also fell for a third straight month.
Canada's share of exports headed to the U.S. was 68.3 per cent in May, down from the 2024 monthly average of 75.9 per cent.
BMO senior economist Shelly Kaushik said in a note to clients Thursday that the proportion of exports heading south of the border hit its lowest level since 1997, outside the pandemic years.
However, StatCan said that exports to countries other than the United States rose 5.7 per cent in the month to reach an all-time high.
Total exports were up 1.1 per cent in May at $60.8 billion as exports of metal and non-metallic mineral products increased 15.1 per cent in May.
Driving the change was a 30.1 per cent increase in exports of unwrought gold, silver and platinum group metals and their alloys — a category largely composed of unwrought gold.
Most of that increase was pegged to higher physical shipments of gold to the United Kingdom, StatCan said.
Total merchandise trade to nations other than the U.S. hit $47.6 billion in May, which the agency said was a third consecutive all-time high.
In addition to U.K.-bound gold, StatCan said higher shipments of crude oil to Singapore and unwrought aluminum and pharmaceuticals to Italy were offset by declines in exports to China.
Though May's trade figures mark an improvement from April, Kaushik said exporters are going to continue to struggle in the face of U.S. tariff uncertainty.
"Exports are likely to face continued pressure with steel and aluminum tariffs doubling in June and little relief from a modest recovery in oil prices," she said.
Meanwhile, total imports fell 1.6 per cent in May to $66.7 billion as imports of metal and non-metallic mineral products dropped 16.8 per cent. Imports of unwrought gold, silver, and platinum group metals plunged 43.2 per cent.
In volume terms, total exports rose 0.7 per cent in May, while total imports fell 0.6 per cent for the month.
Picture Courtesy: AP Photo/Paul Sancya
