Canada's trade surplus with the US plummets by 82%... A sign of deepening US trade conflict

Even before the trade conflict between the two countries, the size of trade with the US was decreasing.

(New York = Yonhap News) Correspondent Kim Yeon-sook = Canada's merchandise trade surplus in July plummeted 82% compared to the previous month.

As exports to the United States decreased significantly amid the trade conflict with the United States, the United States' share of total exports fell to the lowest level since 1997, excluding the period of the COVID-19 pandemic.

Statistics Canada announced on the 3rd (local time) that product exports in July amounted to 769 million Canadian dollars, down 81.7% from the previous month (4.2 billion Canadian dollars).

This is significantly lower than the expert forecast of 3.57 billion Canadian dollars compiled by Reuters.

Exports decreased by 2.3% from the previous month to 76.14 billion Canadian dollars, and imports increased by 2.2% to 75.37 billion Canadian dollars.

The decline was particularly large in trade with the United States, our largest trading partner.

Canada's exports to the United States in July fell 6.6%, recording the largest decline since April of last year. On the other hand, imports of American products increased by 1.8%, mainly passenger cars and small trucks.

Accordingly, Canada's trade surplus with the United States decreased by 42.7% from the previous month to 5.9 billion Canadian dollars. It is the lowest level since last February.

The United States' share of total exports also decreased to 66.3%. This is the lowest level since 1997, excluding the period of the COVID-19 pandemic. A year ago, the U.S. share was 72.6%.

This statistic is noteworthy in that it shows the trend just before the trade war between the United States and Canada intensifies again.

After the collapse of negotiations between the two countries, the US administration of Donald Trump imposed a new 50% tariff on approximately $20 billion worth of Canadian products on the 22nd of last month, and Canada plans to impose retaliatory tariffs of up to 50% on the same amount of US products starting on the 8th.

Given that Canada's exports to the United States have decreased since July, before additional U.S. tariffs were imposed, there are predictions that the future trade environment will become more difficult.