Canada’s trade surplus fell from $1.7 billion in December to $116 million in January, according to Statistics Canada.
Canadian imports reached their highest levels since November 2008 in January and exports followed suit with a fourth consecutive month of increases.
Merchandise imports rose 5.3% to $37.4 billion in January, led by a 16.6% increase in volumes of automotive products. Overall, import volumes rose 5.5% while prices declined 0.2%. Import volumes have been rising since March 2009.
Following a 7.9% increase in December, exports rose 0.8% to $37.5 billion in January. Export volumes increased 1.0% while prices edged down 0.1%.
Gains in exports and imports were most strongly felt in the automotive sector.
Imports of automotive products rose 16.2% to $6.4 billion in January, the result of higher volumes as prices fell slightly. Truck imports led the gain with a 35.8% increase, followed by imports of motor vehicle parts. Despite winter storms and parts shortages that adversely affected some manufacturers in January, imports of motor vehicle parts rose 13.9%. Imports of passenger autos also increased during the month.
Concurrently, exports of automotive products rose 16.3% to $5.2 billion in January, the highest value since May 2010. The gain was a result of rising volumes. Exports of passenger autos, up 22.9%, largely accounted for the growth in the sector. Exports of motor vehicle parts increased as well in January, halting two consecutive months of decline.
Imports of energy products and machinery and equipment were up 13.8% and 1.8% respectively, while a slight decline was seen in the import of industrial goods with a decrease of 0.8%.
Exports of industrial goods and materials increased 3.8% to $9.5 billion in January while energy products rose 2.5% to $9.4 billion.
Machinery and equipment exports dropped 8.9%, agricultural and fishing products exports fell 7.2% and forestry products exports fell 7.4%. However, these decreases were mitigated by the strength of the increases in other sectors.