The Twenty-Four
A resilient start
Alberta makes strides early on but risks lie ahead
By Siddhartha Bhattacharya, ATB Economics 5 June 2025 2 min read
There has been no shortage of news in the tariff-stricken trade world. Last Friday, we saw how front-loading (through exports and inventories build-up) played a key role in propping up national GDP in the first quarter. More recently, U.S. President Trump doubled the tariffs on Canadian steel and aluminum imports to 50% and businesses are expecting an escalation of countermeasures from the Canadian government.
Today’s Twenty-Four takes a quick look at the recent export trends in Alberta, the largest contributor to Canada’s net trade (exports less imports).
New Statistics Canada data shows that international merchandise exports out of Alberta were up by 12.7% year-to-date (YTD) through April relative to the first four months of 2024.
The export value of energy products, the largest sub-sector, was responsible for over 90% of the aggregate increase. This was entirely driven by higher oil and natural gas production, a result of front-loading by U.S. buyers looking to avoid potential tariffs, which offset the impact of waning commodity prices during the same timeframe.
The U.S. remains, by far, Alberta’s largest trading partner, but market access improvements have expanded Alberta’s global energy clientele since last year. Bolstered by China, Hong Kong and Singapore, Alberta’s share of energy exports to non-US destinations reached 7% in April relative to a paltry 3% share observed prior to the Trans Mountain Expansion (TMX) commencing operations last May.
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In addition to the tariff threats weighing on global demand expectations and maintenance-related shutdowns, we have entered wildfire season. Active wildfires in northern Alberta are currently threatening 388,000 barrels of daily oil sands output. Duration and magnitude are key – the bigger and longer the shut-ins, the more economic damage they will inflict. The Wood Buffalo wildfires shaved an estimated 0.6 percentage points off Alberta’s real GDP in 2016.
On the non-energy side, Alberta’s performance remained favourable over the first 4 months with gains in nine out of eleven sub-sectors. Sales were up 2.3% YTD led by machinery and wood products. There are, however, some challenges up ahead in this space as well. China’s tariffs on imports of Canadian canola oil, peas, seafood and pork have been in effect since March 20. Encouragingly, Prime Minister Carney recently mentioned that getting China to remove these tariffs is one of his top priorities.
While the majority of Alberta’s exports is sold internationally, a significant portion (over one-third) of Alberta’s total goods and services exports are destined for other provinces and territories in Canada. Some recent developments targeted to eliminate interprovincial trade barriers are expected to bolster Alberta’s trade flows within the country.
Bottom line: Alberta has delivered a robust export performance so far this year and remains relatively less exposed to the direct impact of U.S. tariffs. Having said that, export momentum is expected to moderate this year against the backdrop of waning global economic conditions, the risk of wildfires impacting energy production, and ongoing trade tensions.
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