OTTAWA, Ont.–The April edition of the Export Performance Monitor revealed that Canadian exports rose 3.6% in February, the biggest gain in 2 years, as almost every sector shared in a boom of exports to the USA. Imports rose by 2%, as Canada’s trade deficit turned into a surplus of $290 million. Export volumes gained 2.2%, but prices also helped with a 1.4% gain for the month, the monitor said.
The top performer was Canada’s automotive sector which rose by 9.7%, because of a massive 24% rise in exports of auto parts. Metals also had a strong February rising 6% mainly because of rising copper shipments. Industrial machinery and equipment gained 4.2%, because of strong sales of agriculture and metalworking machines, driven by strong business investment south of the border. Overall, the gains were broadly shared with nine of the eleven major export categories recording growth on the month. Only agriculture disappointed, declining by 7.7% as extreme cold aggravated Canada’s transportation problems. Canada’s wheat, canola and other crops were all down sharply in spite of record inventories as rail companies that were already struggling with capacity, had to reduce the number of cars due to frigid temperatures, the report noted.
Canada’s strong export performance this month was driven mainly by a 4.4% increase in sales to the US, and this is unusual for two reasons. US overall imports rose just 0.4% in February, making Canada’s 4% gain disproportionately large relative to the rest of the world. Secondly, Canada’s exports had healthy gains in spite of extreme weather in the US which has been depressing economic activity. Many construction and homebuilding projects were put on hold in February because of frigid temperatures which also kept many consumers away from auto dealers. With weather improving, we are looking for big gains in the months ahead as the US economy is gaining speed and construction picks up in a strong investment environment. Canada’s agriculture sector is set for major gains as the rail companies catch up with the backlog in grain shipments. All this combined with rising GDP growth in Europe and Japan, is pointing to a much stronger 2014 for Canadian exporters, said the monitor.