Here's how the tariff chaos is impacting the national economy
Canada’s international merchandise trade deficit widened in June 2025, as imports grew faster than exports. According to new data released by Statistics Canada, merchandise imports increased 1.4% to $67.6 billion, while exports rose 0.9% to $61.7 billion. The resulting trade deficit expanded from $5.5 billion in May to $5.9 billion in June.
One-time shipment boosts imports
June’s import growth was driven largely by a one-time, high-value shipment of industrial machinery. This item—equipment destined for an offshore oil project near Newfoundland—helped push imports in the category up 27.7%, contributing more than $2.0 billion to the total. Without it, imports would have declined 1.9%.
Motor vehicle and parts imports rose 2.9%, supported by a 6.9% increase in passenger cars and light trucks, primarily from Mexico. However, imports of engines and parts declined 4.8% amid reduced Canadian auto production.
Imports of consumer goods dropped 4.8%, with notable declines in pharmaceutical products (-8.8%) and miscellaneous items such as video game consoles (-10.8%). Imports of metal and non-metallic mineral products also fell 7.8%, led by a 63.7% plunge in unwrought gold, silver, and platinum group metals.
Modest recovery in exports
Exports increased for the second month in a row, following a 2.0% rise in May. This recovery comes after an 11.3% drop in April—the steepest in five years—linked to US tariffs on Canadian goods.
Exports of energy products rose 3.8%, driven by crude oil (+3.6%) and refined petroleum products (+19.0%), both benefiting from higher prices and diesel shipments to the United States. Farm, fishing and intermediate food products increased 6.7%, with live animals (+41.6%), canola (+19.1%), and other crops all contributing to gains.
Offsetting these gains was a 3.4% decline in exports of metal and non-metallic mineral products. The decrease was due in part to a 5.0% drop in unwrought gold exports to the United Kingdom. Unwrought aluminium (-11.3%) and iron and steel (-11.4%) also declined amid higher US tariffs. Vehicle exports dropped 4.2%, led by an 8.9% decline in passenger cars and light trucks.
Trade by country
Exports to the United States rose 3.1%, while imports increased 2.6%, widening Canada’s trade surplus with the US from $3.6 billion to $3.9 billion.
In contrast, exports to countries other than the US fell 4.1% following record highs in May, though they remained 14.7% higher year over year. Imports from these countries slipped 0.3%, increasing the trade deficit with non-US partners to $9.8 billion.
Quarterly results and services trade
Total exports declined 12.8% in the second quarter, following a record 4.2% rise in the first. Imports fell 3.9%. Canada’s merchandise trade deficit ballooned to $19.0 billion in Q2. In constant dollars, real exports dropped 9.0%.
In services, exports rose 1.0% to $18.0 billion, while imports edged down 0.2% to $18.7 billion. The total trade deficit in goods and services reached $6.5 billion in June.
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