Monthly trade report: 2025 - July

ISSN 2819-408X

September 2025

Highlights

• Canada’s exports of goods and services increased 1.3% in July (see column “m/m” in Table 1) driven by higher exports of energy products, motor vehicles and parts, and a broad service export increase that brought service exports to their highest levels of 2025.
• Canada’s imports of goods and services fell 0.9% in July largely due to a large one-time import of a module for an oil platform in June which was not repeated in July, and decreased imports of commercial and transportation services.
• Exports to the United States have increased 5.0% in July but are still down 2.9% year-to-date since January compared to the same period in 2024. Exports to other markets fell 8.6% in July but were still 13.7% higher than year-to-date in 2024.
• The increase in exports and decrease in imports were both due to changes in volumes. Goods export volumes grew 1.5% in July while import volumes decreased 0.8%.

Table 1: Canada’s trade performance – July 2025

Figure 1: Canada’s monthly trade performance

Industry view - exports

Export gains were broad-based, increasing in 7 of the 11 goods product categories and 3 of the 4 service categories. Goods exports were up 0.9% in July for the third month in a row. Growth was led by electronic & electrical equipment, which increased 9.6%, and exports of energy products, which grew 4.2% in July. Crude oil drove the increase in exports of energy, increasing 2.3% in July due to increased shipments to the U.S. and supported by increased prices and volumes. Exports of motor vehicles and parts grew 6.6% in July. The month of July usually sees temporary closures at auto assembly plants for summer holidays, but production was already at lower levels earlier in the year due largely to U.S. tariffs. Since production was already low, July did not see as many closures and exports ticked up.

Exports of metal and non-metallic mineral products fell 8.0% in July as less unwrought gold was exported to the United Kingdom, but exports of unwrought gold were still 25% higher than July 2024. Exports of unwrought aluminium were also down 31.0% in July after decreasing the 3 previous months, coinciding with U.S. tariffs.

Total service exports increased 2.6%. Travel service exports grew 4.0% in July as U.S. residents increased their spending in Canada. Commercial services exports increased 1.8%, while transportation services grew 2.9%. Exports of government services were unchanged in June.

Figure 2: Exports by industry and sector (monthly % change)

Industry view - Imports

Imports increased in almost all goods product categories (10 out of 11), but only in 1 out of the 4 service categories. Despite this, goods imports overall decreased by $486.8 million or 0.7% in July, due entirely to a 18.8% or $1.8 billion decrease in the import of industrial machinery, equipment and parts. This significant decrease was because of a large, one-time import in June of a module for an oil project off the coast of Newfoundland. Excluding industrial machinery, equipment and parts, goods imports increased 2.2% in July.

Imports of aircraft and other transportation goods saw the largest increase of $252.2 million or 11.0% in July due to increased aircraft imports (74.2%). Motor vehicles and parts imports also increased 2.2% in July, while consumer good and farm, fishing and intermediate food products imports increase 1.6% and 7.8% respectively.

Total service imports decreased 1.3% to $18.2 billion in July. This decrease was led by commercial services, which fell 2.2% in July and imports of transportation services, which fell 1.9%. Travel service imports increased 1.2%.

Figure 3: Imports by industry and sector (monthly % change)

Global markets

While goods exports to the U.S. increased 5.0% from June to July, they were still down 2.9% in the first 7 months of 2025 compared to the same months in 2024. July’s monthly increase was due to higher exports of crude oil and passenger cars to the U.S.. Imports from the U.S. decreased for the fourth time in 5 months, falling 2.2% in July. The increased exports and decreased imports pushed Canada’s goods trade surplus with the U.S. from $3.7 billion in June to $6.7 billion in July.

Exports to markets other than the U.S. continued to decrease, falling 8.6% in July. Despite this monthly decrease, exports to markets other than the U.S. were still 13.7% higher year-to-date since January compared to the same period in 2024. The decrease from June to July was largely due to lower exports of unwrought gold to the United Kingdom, unwrought aluminium and crude oil to the Netherlands, and various products to Spain. Taken together, imports from non-U.S. markets increased 1.3% in July which widened the trade deficit with those markets from $9.7 billion in June to $11.7 billion in July.

Figure 4: Goods trade by main markets (monthly % change)

Prices and volumes

Increased goods exports were entirely driven by volumes, which grew 1.5% in July. Amid tariff uncertainty, goods export volumes have been volatile in 2025, with growth swinging between positive and negative from month-to-month. Despite a small growth in the price of crude oil—the Western Canada Select (WCS) oil price increased 0.2% in July—goods export prices declined 0.7%, the first decline in 3 months.

The decline in goods imports were also driven by volumes, which were down 0.8%. This was the third decline in the last 4 months for goods import volumes. Goods import prices rose slightly (0.2%)—the first growth since February 2025.

The Canadian dollar depreciated slightly in July, dropping 0.1% to 73.04 US cents. This was the first monthly depreciation since March 2025.

Figure 5: Goods trade (monthly % change in volume and price indices)

Figure 6: Exchange rate & oil prices

What to watch

• Canada’s real GDP decreased by 1.6% (annualized) in the second quarter of 2025, after rising 2.0% in the first quarter. The second quarter decline was the first decrease seen in 2 years and was largely due to a significant decline in goods exports after a surge in the first quarter. Canadian trade continues to be directly affected by U.S. economic performance and trade policy developments. Since a recession is defined as two consecutive quarters of contraction, it is too early to know whether the Canadian economy is heading towards a recession.
• Meanwhile, U.S. real GDP grew at an annual rate of 3.3% in the second quarter after a contraction in the first quarter. This increase was primarily driven by a large decrease in imports (which is a subtraction in the GDP calculation) and an increase in consumer spending. However, the sharp drop in imports comes on the heels of a major surge in the first quarter as businesses stockpiled ahead of tariffs.
• Despite overall GDP growth, the U.S. manufacturing sector continues to grapple with tariffs and shifting supply chains. According to the Institute of Supply Management, the manufacturing sector in the U.S. contracted for the sixth consecutive month in August. One bright spot is that there was a recent boost in new orders which could support future sustained demand for inputs.

Next release: October 7, 2025

Table 2: Trade by industry sector – July 2025

Table 3: Goods trade by main markets – July 2025