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Monthly Trade Report – November 2021

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Highlights

Data: Statistics Canada Tables 12-10-0011-01 and 12-10-0144-01. Balance of payments basis, seasonally adjusted.

Industry view

Import Import increases were observed in 6 of the 11 product categories for goods, and only 1 of the 4 service sectors. Imports of consumer goods rose for the fourth consecutive month in November (+5.2%). Pharmaceutical products, especially COVID-19 medication sent to Canada to be packaged and labelled, were responsible for the gain. Consumer goods were also supported by a sharp increase in the imports of "vaccines for human medicine other than for influenza," a category that includes vaccines for COVID-19. Imports of metal and non-metallic mineral products rose 7.3% in November, mainly from higher imports of iron and steel products from South Korea. Imports of basic and industrial chemical, plastic and rubber products (+7.3%) also contributed to the overall gain in November, supported by higher imports of crude oil diluents from the United States. Travel services was the only service import sector to increase in November, growing by 21.1%. Cross-border restrictions were further lifted as the United States opened its land borders to all fully vaccinated travellers on November 8th.

Export increases were observed in 8 of the 11 product categories for goods, and in all 4 service sectors. Exports of consumer goods increased 9.0% in November, mainly because the large shipments of COVID-19 medications imported for packaging and labelling were subsequently exported during the same month. Though medication was a strong driver of growth in November, there were many other products that saw gains, including chemical, plastic and rubber products (+14.7%), energy products (+2.8%), and forestry products and building and packaging materials (+6.7%). When pharmaceutical products are excluded, goods exports grew 2.8% in November (compared to 3.8% for total goods exports). It is worth nothing that while widespread increases were observed in November for goods exports from most Canadian provinces, goods exported from British Columbia fell 7.8% (customs basis and not seasonally adjusted) as the transportation of goods through key ports of entry and exit on the West Coast were disrupted by the flooding and landslides in mid-November. All services categories posted respectable increases in the month, with travel (+9.0%) and transportation services (+3.2%) posting the fastest growth. As a result, total service exports rose 2.9% to $11.7 billion in November, just 0.3% below the pre-pandemic level.

Data: Statistics Canada Tables 12-10-0121-01 and 12-10-0144-01. Balance of payments basis, seasonally adjusted.

Global markets

Canadian goods exports to the United States rose 6.4% in November to a new record high of $45.2 billion, while goods imports from the United States were up 4.9% to $35.4 billion, also a new record. The large growth in November was mainly supported by the atypical shipments of COVID-19 pharmaceutical products to be labelled and packaged. Canada's trade surplus with the United States widened from $8.8 billion in October to $9.8 billion in November, the largest trade surplus since January 2006.

Goods exports to non-U.S. countries were down 4.0% in the month of November, partly because of the transportation disruptions in British Columbia. Exports destined to Hong Kong (crude oil), China (coal, and farm and fishing products) and the Netherlands (various products) contributed the most to the decrease.

Goods imports from non-U.S. countries also declined, falling by 1.8% in November. Lower imports from China (various products) were partially offset by higher imports from Japan (turbines and light trucks).

Data: Statistics Canada Table 12-10-0011-01. Balance of payments basis, seasonally adjusted.

Prices and volumes

The 2.4% increase in the value of goods imports was two thirds driven by increased prices (1.6%) and one third driven by volumes increases (0.8%). Notably, there was a 15.3% increase in import prices for energy. 

On the other hand, the increase in exports (3.8%) was almost entirely driven by increases in volumes (3.5%), with a small increase in prices (0.3%). Of note, there was a large increase in the volume of basic and industrial chemical, plastic and rubber products (15.3%).

In November, the value of the Canadian dollar relative to the USD depreciated 1.1% to sit at 79.6 cents per USD. This erased a major chunk of the gains in the previous month, where the Canadian dollar appreciated 1.9% in October.

Data: Statistics Canada Table 12-10-0128-01. Balance of payments basis, seasonally adjusted.

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