Canada’s economy was up for the third month in a row in May and exports were up for the fourth month, Statistics Canada reported Tuesday.
This three-month extension coincided with the Iran war sending shockwaves through global supply chains for essential goods and services, which appeared to benefit Canada’s export economy.
Exports in May rose 0.9 percent to a record $77.1 billion, marking the fourth consecutive monthly increase. Part of this increase in export prices is due to higher prices of resources such as oil during the Iran war.
“With the latest trade numbers, Canada’s export story is balancing,” said economist Jasleen Trehan at the Business Data Lab and the Canadian Chamber of Commerce in a statement.
“The next challenge is to ensure that this momentum is driven by strong exports, not just high prices. That will determine whether today’s gains translate into long-term economic growth.”
Iran’s war has brought container shipping closer to the Strait of Hormuz region as Iran has threatened to attack any ships that try to pass through the small port without permission during the conflict, putting a fifth of the world’s oil and other resources at risk.
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One of those resources was sulphur, Statistics Canada said, and Canadian exports of sulfur products, as well as diamonds and other non-metallic minerals, rose 37 per cent in May.
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Demand for Canadian crude oil on international markets rose sharply in the first three months of the Iran war, but that changed in May when Statistics Canada said crude oil exports fell 5.4 per cent, after rising 43 per cent from February to April.
Crude oil prices soared during the Iran war, so the agency says the price volatility means it may have to revise some of its data down.
There was still strong global demand for Canadian energy alternatives in May, which the Canadian economy benefited from. There was a 55 percent increase in demand for nuclear fuel, while natural gas exports rose 7.4 percent and refined petroleum energy products rose 4.6 percent.
Canada also exported more aluminum products in May, as US President Donald Trump’s tariffs, including on Canadian steel and aluminum imports, continued to bite. There is currently a US tariff of up to 50 percent on Canadian core aluminum products, while other derivatives such as auto parts may see a lower tariff.
Prime Minister Mark Carney has vowed to double Canada’s exports to countries outside the US over the next decade, and Tuesday’s report shows that may be working.
Statistics Canada says there was a more than 50 percent increase in exports of aluminum products in May compared to April, most of which were sent to the Netherlands, Italy and Greece. In total, those aluminum exports were worth $1.2 billion, which was the highest since the record seen in May 2022.
Although Canada sent more goods to international partners in May compared to the previous month, exports to the US still rose 1.5 percent in May, marking the fourth consecutive increase. At the same time, imports from the US decreased by 1.4 percent, which contributed to the trade surplus with the US amounting to $11.6 billion per month.
This was the largest trade surplus with the US since the record high seen in January 2025, the agency said.
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