Canada's International Trade Deficit Much Higher Than Expected in January; Trade Surplus With The U.S. Tad Lower

08:49 AM EDT, 03/12/2026 (MT Newswires) -- Canada's merchandise trade deficit with the world widened to $3.6 billion in January from $1.3 billion in December, as merchandise exports decreased 4.7% month over month, while imports were down 1.1%, said the country's statistical agency on Thursday.

January's deficit was more than three times the $1.10 billion consensus figure provided by MUFG.

In January, export decreases were observed in six of the 11 product sections, noted Statistics Canada. In real (or volume) terms, total exports declined 5.8% month over month, with exports of motor vehicles and parts felling 21.2% to $5.4 billion, which was the lowest level since September 2021.

Exports of passenger cars and light trucks (-32.5%) saw the largest decline, mainly due to lower motor vehicle production.

Overall, import declines were observed in seven of the 11 product sections, added StatsCan. In real (or volume) terms, total imports were down 2.2% month over month. Imports of motor vehicles and parts decreased 4.5% in January. Imports of motor vehicle engines and parts (-8.3%) posted the largest decline, coinciding with lower motor vehicle production in Canada.

Canada's merchandise trade surplus with the United States narrowed slightly from $5.7 billion in December to $5.4 billion in January as exports to the U.S. decreased 3.8% month over month, while imports from the U.S. fell 3.4%.

Canada's trade deficit with countries other than the U.S. widened from $7.0 billion in December to $9.0 billion in January as exports to countries other than the U.S. were down 6.5% month over month. The decline was mostly due to lower shipments of unwrought gold to the United Kingdom.

Imports from countries other than the U.S. increased 2.1% month over month in January, due in part to higher imports of industrial machinery from China.

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