Canada’s merchandise trade surplus increases, lifted by vaccine production

Canada’s international merchandise trade surplus widened to 3.1 billion CAD in November because of an unexpected source–the mass production of the COVID-19 vaccine, according to data released by Statistics Canada on Thursday.

With the approval of the COVID-19 vaccines to children ages 5 to 11, demand and production of the vaccine jumped. Canada had significant gains in the trade of pharmaceutical products as large quantities of the vaccine were imported for packaging and labeling, and later exported.

This increase accounted for most of the gains in exports, which rose 3.8%, and imports, which were up 2.4%.

Energy exports also rose as global energy demand remained strong heading into the winter. The energy sector has played a vital part in the recovery of the Canadian economy as producers have pushed to meet the surging demand at record-breaking prices.

The historic floods and landslides in British Columbia disrupted transportation and led to a drop in exports with countries other than the United States that relied heavily on the Port of Vancouver.

In response, companies got creative and rerouted exports through the United States to Asian countries. As a result, exports to the United States rose by an impressive 6.4%.

Transportation disruptions associated with floods in British Columbia affected trade data into December and will continue to do so in the new year.

The impact of COVID-19 remains highly fluid and uncertain, with the omicron variant potentially affecting trade in the upcoming months, though the effect might be short-lived with this faster-moving variant.