Monthly trade report - February 2025

Highlights

• In February, Canada’s exports of goods and services fell 4.8% (see column “m/m” in Table 1) driven by lower exports of forestry products, metal ores and non-metallic minerals, motor vehicles and parts and transportation services.
• Imports of goods and services were up 0.4% month-over-month. Higher goods imports, particularly in motor vehicles and parts, offset lower service imports.
• Canadian exports to the United States fell because of lower exports of unwrought gold and iron and steel products, while Canadian imports from the United States rose. Two-way trade with markets outside the United States fell, most notably exports to the United Kingdom and Germany.
• The decrease in goods exports were largely driven by volumes, as prices posted more modest declines. Goods’ export volumes fell by 5.0% while import volumes were unchanged.

Table 1: Canada’s trade performance - February 2025

Figure 1: Canada’s monthly trade performance

Industry view - Exports

Export decreases were observed in 9 of the 11 product categories for goods, and in all of the 4 service sectors in February. Total goods exports decreased 5.5% from January to February after 4 consecutive monthly increases, falling below December 2024 levels but still above most of 2024. Forestry products and building materials posted the largest percentage decrease at 10.8%. Within this category, lumber and other sawmill products fell 19.3% and pulp and paper exports decreased 13.0% due to lower shipments to the United States.

After 4 months of growth, exports of metal and non-metallic mineral products fell 6.6% in February but remained above levels seen in most of 2024. Exports of unwrought gold, silver and platinum were down 5.9% as exports of unwrought gold to the United Kingdom and the United States fell, while exports of basic and semi-finished iron and steel to the United States also decreased. After reaching a record high in January, exports of motor vehicles and parts decreased 8.8% in February wiping out a year of gains. This was mainly due to passenger cars and light trucks (-15.3%) falling from its peak in January. Exports of aircraft and other transportation equipment and parts (+9.7%) was a bright spot in February supported by higher shipments of business jets to the United States.

Total services exports declined 1.6% in February to $17.7 billion. The decrease was largely due to transportation service exports decreasing 7.7% because of lower receipts of passenger fares, and travel services decreasing 1.3%.

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

Industry view - Imports

Imports decreased in 6 of the 11 product categories for goods but in only 1 of the 4 service sectors in February.

Total goods imports increased by a modest 0.8%. Motor vehicles & parts as well as energy products increased $715 million and $192 million (or 5.8% and 5.2%) respectively in February. The increase in motor vehicles & parts were driven almost entirely by imports of passenger cars and light trucks, increasing by $672 million or 10.7% from January.

Aircraft & other transportation imports fell $315 million (or 11.4%), month-over-month. These losses were seen mostly by imports of aircraft (-$287 million). Imports of chemical, plastic, and rubber products also fell 3.3% while forestry products decreased 2.4% but both categories remained above levels seen throughout 2024.

Total service imports declined by 0.8% in February to $18.3 billion. Commercial services recorded the largest month-over-month services decrease, falling by $201 million (-2.0%), largely due to less imports of financial services. Travel services imports increased 0.4% in February as lower spending by Canadians in the United States was more than offset by Canadian travellers in other countries. This decrease in spending in the United States occurred as the number of Canadians returning from trips to the United States by automobile recorded a steep decrease compared to February of 2024 (-23.0%).

Statistics Canada continues to caution that the import data may be subject to more significant revisions than usual during the transition to a new data collection approach.

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

Global markets

After reaching a record high in January, goods exports to the United States fell 3.6% month-over-month or by $2.1 billion in February with lower exports of unwrought gold and iron and steel products. In contrast, imports from the United States rose 2.5% in February, resulting in a lower goods trade surplus with the United States of $10.6 billion in February, down from a record $13.7 billion in January.

Goods exports to countries other than the United States fell 12.4% in February. This decrease was due largely to lower exports of unwrought gold to the United Kingdom and lower exports of various products to Germany. These decreases were partially offset by increased exports of various products to South Korea. Goods imports from countries other than the United States decreased 2.0% in February. As a result, Canada’s trade deficit with countries other than the United States widened from $10.6 billion in January to a record $12.1 billion in February.

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

Prices and volumes

Export volumes for goods dropped 5.0% in February, following an increase of 4.8% in the previous month. Goods export prices also declined, although by only 0.5%, still make this the first month that both volumes and prices decreased at the same time since May 2024.

Goods import prices grew 0.8% in February while goods import volumes remained unchanged.   

The decline in goods export prices coincided with a drop in the Western Canada Select (WCS) oil price, which decreased 6.0% in February, after experiencing 8.8% growth in the previous month. The Canadian dollar appreciated slightly in February, rising 0.6% to reach US69.93 cents, the first monthly growth after 4 consecutive months of decreases.

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

Figure 6: Exchange rate & oil prices

What to watch

• The United States announced “reciprocal” tariffs on most countries around the world on April 2. These tariffs ranged from a 10% base rate to as high as a 50% levy. Canadian and Mexican products were not included in the announcement but are still facing previously announced tariffs that affect steel, aluminum, automobiles and non-compliant CUSMA products. The impacts of these trade measures will increasingly be reflected in the statistics of coming months.
• On March 12 the Bank of Canada cut the policy interest rate by a further 25 basis points to bring it to 2.75%. Meanwhile, the United States Federal Reserve held their target rate for the federal funds rate steady at 4.25% to 4.5% on March 19. Both central banks cited the U.S. tariff uncertainty in their decisions.
• On March 20 the Chinese Ministry of Commerce applied a 100% tariff on Canadian canola oil, oil cakes, and pea imports, and a 25% levy on Canadian seafood and pork. This was in response to Canada’s tariffs on Chinese-made electrical vehicles, aluminum, and steel that were announced in October 2024.

Next release: May 6, 2025

Table 2: Trade by industry sector – February 2025

Table 3: Goods trade by main markets – February 2025