Canada’s merchandise exports to the world hit a record annual high in 2006, despite the first decline in exports to the United States in three years, Statistics Canada reported today.

In total, Canadian companies exported nearly $458.2 billion worth of merchandise abroad last year, a 1.1% gain from 2005. However, imports rose 4.2% to $404.5 billion, which was also a record high.

As a result, Canada’s annual merchandise trade balance with the world fell by more than $11.2 billion to $53.6 billion, its lowest level since 1999.

On a monthly basis, both exports and imports ended the year on a strong note. Imports surged 3.6% in December to a new monthly peak of $35.4 billion, the third monthly gain in a row. Exports rose 3.8% to $40.4 billion. This level was just shy of the monthly high recorded a year ago December, when energy prices peaked after hurricanes devastated the U.S. Gulf Coast.

As a result of the larger gain in exports, Canada’s trade surplus with the world increased to $5 billion in December, its highest level since February.

Automobiles and energy led December’s gains in both exports and imports, although all sectors registered increases. Shipments of new car and truck models to the rest of the North American auto market pushed up exports. Strong auto sales in Canada up to the very end of 2006 meant strong auto imports for December.

Exports of automotive products posted a strong 8.4% gain in December, the third consecutive increase for the sector, as Canadian auto manufacturers put a push on distributing new models to the U.S. market.

Exports of industrial goods hit a record high of $8.8 billion as a result of a 2% increase for the month, the sector’s eighth consecutive rise.

Energy export values were up 5.8% in December to $7.3 billion, mainly on the strength of natural gas.


Gains were widespread amongst all sectors for imports, although autos, energy and other consumer goods made notable advances for the month.

Automotive imports increased for the third consecutive month, climbing 6.5% in December to $7.1 billion.

Energy imports were up for a second month in December, with an increase of 7.9% to $2.9 billion.