OTTAWA — It’s the same story: because of weaker automotive and forestry exports, total Canadian exports dipped another 1.7 percent in October.

Add a second-straight month of slumping energy exports, the U.S. saw its lowest Canadian export total in nearly two years ($28.5 billion), according to Statistics Canada. As a result, trade surplus with the Americans fell to its lowest level in three years ($6.8 billion). Imports were up 0.4 percent, however.

The price of natural gas and the volume of refined petroleum products like crude fell in October, causing energy exports to tumble 11.5 percent. The value was about $3 billion short of last October’s record high value.

Diesel fuel exports from Canadian refineries declined for the second straight month, pulling down other energy products 17.2 percent to $1.4 billion. Reports indicate that distillate stocks in the United States are 20 percent higher this year than in 2005, contributing to the reduction in demand, reports Stats Canada.

In addition to energy, exports of agricultural products, machinery and equipment, and forestry products also registered decreases.

Behind the drop in agricultural exports was a setback for rapeseed (canola) as well as for wheat. Nevertheless, wheat volumes have been generally strong in 2006, more than 5 percent greater than in 2005.

Despite an overall decrease, exports of industrial
goods grew for the sixth consecutive month

In contrast, however, exports of industrial goods grew for the sixth consecutive month as a result of the strength of metals shipments. The sector reached a new record-high of $8.4 billion in October mainly thanks to metals.
Zinc and copper values, in particular, have increased as refining companies smooth over gaps in raw materials with imported goods.

On the whole, automotive exports have been on a sharp downward trend in 2006, with car exports dragging down the sector. But thanks to a pre-buy sweep across North America from truck buyers looking to avoid more expensive EPA-mandated equipment next year, truck exports shot above the August level to hit $1.3 billion in October.

IMPORTS:

Machinery and equipment imports also managed an increase for the month, as industrial and agricultural machinery registered gains of 4.3 percent to $2.8 billion. While drilling and mining machinery and other industrial machinery continued to show strength as a result of demand from the booming Western provinces, imports of wind turbines were the major contributor to the sector’s increase in October.

Imports of consumer goods got a boost in October as clothing and pharmaceutical products both showed solid increases. Clothing imports have demonstrated a gradual upward trend in 2006, and after being down in August and September, imports advanced to a record-high $700 million.