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Canada’s exports hit a record high in February, boosted by energy products According to Reuters


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© Reuters. FILE PHOTO: A skyline view of downtown Edmonton, Alberta, Canada, October 6, 2021. REUTERS / Todd Korol

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By Julie Gordon

OTTAWA (Reuters) – Canada’s exports rose 2.8% in February to a record high, mainly driven by energy products, while imports rose 3.9% month-on-month, data from Statistics Canada showed on Tuesday, with economists predicting a further increase in exports.

The country’s trade surplus with the world narrowed to C$2.66 billion ($2.14 billion), below analysts’ forecast of C$2.9 billion. However, exports came in above expectations of C$58.75 billion, with imports of C$56.08 billion.

Statscan also said the border blockades in February by anti-vaccination protesters had little impact on overall commerce, with most overland shipments already rerouted.

Shelly Kaushik, an economist at BMO Economics, said: “Canada’s balance of trade narrowed slightly in February as imports recovered from the previous month’s weakness. However, the bigger story is the string of surpluses. Recent surpluses are supported by strength in energy prices,” Shelly Kaushik, economist at BMO Economics, said in a note.

“Looking ahead, further strong commodity prices will continue to boost exports in March.”

Energy exports rose 7.8% to a record high, accounting for more than two-thirds of the total increase, while exports of non-energy products increased 1.2%. In terms of volume, exports increased by 0.6%.

“Exports contributed the most to growth in February 2022, largely due to higher prices,” Statscan said.

Oil prices escalated even before Russia’s invasion of Ukraine on February 24 and have since risen sharply. Canada is the fourth largest oil producer in the world.

The crisis has also boosted imports, with Canadian imports of fertilizers, pesticides and other chemicals reaching record highs. Statscan points out that a decrease in production in China and a quota on fertilizer exports from Russia are contributing factors.

“These events create uncertainty about the availability and cost of these products, leading to atypical movements for Canadian fertilizer imports,” it said.

With imports expected to fall again in March and commodity exports benefiting from rising prices, the surplus is likely to widen in the coming months, analysts said. said.

“In our estimation, trade terms are currently the most favorable on record and lead to an improvement in the row surplus,” said Stephen Brown, senior Canada economist at Capital Economics. to a peak of C$6.0 billion,” Stephen Brown, senior Canadian economist at Capital Economics, said in a note.

“It remains to be seen how much of that extra income will go into the rest of the economy,” he added.

The Canadian dollar traded 0.6% higher at 1.2410 greenbacks, or 80.58 US cents.

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