Exports edge down after three months of solid gains – Exports edged down in April, falling 0.2 per cent mainly because of declining prices, while export volumes actually rose by 0.7 per cent a helpful boost that leaves Canada well-positioned for growth. Overall, Canada’s exports are up 3.9 per cent compared to April 2012, and Canada is tracking towards a healthy gain for 2013.

Monthly trade numbers are volatile and after 3 months of impressive gains it was widely expected that there would be some retrenchment, and in fact there was wide variability in gains and losses across sectors.

The big winner was the metal products sector which rose by 10.6 per cent, mainly because of precious metals which surged by 40.5 per cent in April due to rising gold shipments. Canada’s forestry sector also edged up by 0.4 per cent as a 2.5-per-cent fall in pulp exports was overtaken by a 23-per-cent gain in logs and other forestry products, as demand from the red‐hot US housing market charges ahead.

The largest decline was in metal ores which fell 13.8 per cent on a 62-per-cent plunge in copper shipments. Canada’s energy exports were also lower in April as crude oil was down 2 per cent while electricity export s fell 9.8 per cent.

By destination, the U.S. was once again the star with exports to our southern neighbour rising 1.8 per cent. This was in stark contrast to the rest of the developed world. Exports to the European Union fell 10.3 per cent, sales to Japan declined 14.8 per cent, while all other rich OECD countries fell 15.5 per cent. Sales to emerging markets gained 2.8 per cent.

Overall, the fact that Canada’s exports stabilized in April will enable us to lock in the gains from previous months. The U.S. economy is weighed down by the effects of sequestration and government cutbacks, but consumer confidence hit a five‐year high in May, while home prices are now up 10.9 per cent year‐over‐year, and unemployment is at a four‐year low of 7.5 per cent. The accelerating momentum in the U.S. alongside the positive growth outlook for emerging markets should provide uplift to exports in the months ahead. The main downside risk to Canada’s export growth comes from further deterioration in commodity prices

This report is reprinted with permission from EDC. It is a compilation of publicly available information and is not intended to provide specific advice and should not be relied on as such. No action or decisions should be taken without independent research and professional advice. EDC is not liable whatsoever for any loss or damage caused by or resulting from any inaccuracies, errors or omissions in such information.