Elevated oil prices and strong shipments of gold to London’s bullion market have boosted Canada’s international exports.

The seasonally-adjusted dollar value of Canada's merchandise exports increased by 8.5% in March compared to February. If the impact of higher prices is excluded, the real value of exports actually edged down by 0.3%.

Exports to both the U.S. (+8.2%) and non-U.S. destinations (+9.1%) increased in March. U.S. sales, however, remained below pre-tariff levels with levies on steel, aluminum, lumber and other products restraining overall growth. Higher exports of gold to the United Kingdom and crude oil (from Newfoundland and Labrador) to Germany and the Netherlands drove the increase in sales to non-U.S. destinations.

Ideally, we’d like to see an increase in volume alongside price-driven growth, but given the ongoing headwinds from U.S. tariffs, the growth in March is a welcome outcome.

With that said, the sudden surge in oil prices due to the Iran conflict and volatile gold prices are not a sustainable basis for long-term export growth.

Valuable stuff

Canada’s most important export by far is black gold (a.k.a. crude oil and bitumen). At 18% of the total, oil and bitumen accounted for the largest share of Canada’s merchandise exports last year.* Second on the list at 7% was gold (to be fair, if you bundle up motor vehicles of all types along with motor vehicle parts, the “auto sector” takes over second place from gold).

In any case, Canada’s gold exports had a very strong year in 2025 due to rapid price growth. Gold exports were 36% higher than in 2024 and 82% higher than in 2023.

The surge in gold exports to overseas destinations (to the U.K. in particular) helps explain why the share of Canada’s exports that went to the U.S. fell last year.

What’s next?

With the Canada-U.S.-Mexico Agreement (CUSMA) under review this summer and sectoral tariffs still punishing key industries, our base case forecast assumes the status quo on tariffs. That is, sector-specific measures remain in place, but CUSMA exemptions shield most of Canada’s exports from U.S. tariffs. This reinforces the importance of continuing to expand trade with other partners, while still landing a long-term free trade deal with the U.S.

As for the impact of higher oil prices, we see this dissipating over time once the conflict has been resolved and oil prices journey back to lower levels, but with the potential for the volume of energy trade to increase further via more exports to Asia as additional transportation infrastructure comes online.

The M in CUSMA

It being Cinco de Mayo* today and with regard to the goal of increasing trade with other countries, we thought it would be fun to include a few stats on Canada’s trade with Mexico:

• The Mexican market includes about 133 million people.
• Mexico was Canada’s 7th largest customer at about $8.9 billion of goods purchased from Canadian suppliers last year.*
• Canada’s main exports to Mexico are vehicle parts and agricultural products.

*Source: Trade Data Online, customs basis

**Cinco de Mayo, or the Fifth of May, is a holiday that celebrates the date of the Mexican army’s May 5, 1862 victory over France at the Battle of Puebla during the Franco-Mexican War. While it is a relatively minor holiday in Mexico, in the United States, Cinco de Mayo has evolved into a commemoration of Mexican culture and heritage, particularly in areas with large Mexican-American populations. (Source: history.com)

Answer to the previous trivia question: The last time the Montreal Canadiens won the Stanley Cup was in 1993.

Today’s trivia question: How many states are there in Mexico?