OTTAWA, Ont. – Canada’s merchandise trade surplus with the world widened in August in the wake of a decline in exports and an even sharper decrease in imports, which had hit a record high the month before.

According to a Statistics Canada report, exports decreased 1.8% to $38.5 billion as only two sectors-machinery and equipment and agricultural and fishing products-recorded gains.

After peaking in July, imports fell 3.9% to $34.4 billion in August. Despite the considerable appreciation of the Canadian dollar against the American dollar since the beginning of 2007, August’s decrease in imports was the result of widespread declines in all sectors except energy, agricultural and fishing products.

With imports falling at twice the pace of exports, the nation’s trade balance with the world expanded to $4.1 billion. At the same time, Canada’s trade surplus with the US widened to $6.7 billion.

The deficit with countries other than the US narrowed to $2.6 billion, with all principal trading areas contributing to the contraction.

Declines in exports of industrial goods and materials, and to a lesser extent automotive products, overshadowed gains in machinery and equipment, and agricultural and fishing products, the only two sectors to record increases in August.

Exports of forestry products fell 1.0% to $2.4 billion, the fifth decrease in as many months. Canadian production has been curtailed by labour unrest in B.C.

Energy products slipped 0.3% to $7.2 billion, the third monthly decline.

Increased exports of natural gas and other energy products, particularly coal and other bituminous substances, were offset by decreases in crude petroleum.

Imports decreased for the first time since May.

Although the declines were widespread, the automotive products and industrial goods and materials sectors led the decrease. The only sector to record an increase was agricultural and fishing products.

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