Canada’s merchandise trade surplus expanded rapidly to a four-year high of US$2.98 billion in May. The official report from Statistics Canada (StatsCan) on Tuesday showed the macroeconomic indicator surging above the initial expectations of Reuters analysts who had estimated a lackluster target of around C$2.85 billion.
This solid performance marks the third consecutive month that Canada has managed to maintain its trade surplus, driven aggressively by a 1.5% surge in exports to the United States. The value of exports south of the border surged to C$53.72 billion, representing nearly 70% of Canada’s total international trade portfolio in May.
Along with the surge in exports, Canada’s imports of goods from the US were found to have shrunk by 1.4%. The chain implications saw the specific trade surplus between Canada and the United States widen to C$11.6 billion, the largest monthly performance since a historic peak in January 2025.
Breaking down by commodity component, StatsCan revealed that the increase in exports was led by a drastic 16.1% jump in shipments of metal ores and non-metallic minerals, particularly sulfur. Analysts said Canada's sulfur exports benefited from a windfall as global maritime logistics chains in the Strait of Hormuz were disrupted by geopolitical tensions in the Middle East.
However, the energy sector recorded a technical contraction of 2% due to a reduction in domestic crude oil export volumes. In financial markets, the Canadian dollar was trading down 0.06% to 1.4214 against the US dollar, while the two-year government bond yield rose 0.9 basis points to 2.367%.
