Canadian exports to China surged by 30% in the first half of 2026, with overall trade increasing by 3.6% year over year, as per Statistics Canada data analyzed by experts. The data, featured in a recent report by the Canada China Business Council and the University of Alberta’s China Institute, signify the renewed trade relations between the two nations. Canada aims to broaden its economic horizons amidst strained ties with the U.S.
Trade in goods between Canada and China reached $66.6 billion in the initial half of 2026, marking a 3.6% rise, while exports soared by 30% to $21.74 billion compared to the previous year. The trade was dominated by energy and minerals, accounting for 58.4% of all domestic exports to China during the period, with energy, particularly crude oil and liquefied propane, witnessing an 81.8% surge. Notably, exports of metal ores and non-metallic minerals, including copper ore, increased by 29%.
Bijan Ahmadi, the executive director of the Canada China Business Council, noted, “This is a record-breaking performance for our exports to China in the first half of the year.” The recent spike in trade is attributed to various factors, despite the ongoing geopolitical tensions between the two countries.
The warming diplomatic and economic ties between Canada and China follow years of strain, notably triggered by the arrest of Huawei executive Meng Wanzhou in 2018. As Canada-U.S. trade conflicts intensify, Prime Minister Mark Carney emphasizes Canada’s strategy to forge new trade pacts and reduce dependency on the U.S. market, aiming for economic resilience and growth.
The Trans Mountain Pipeline, operating at 97% capacity in June, has significantly enhanced Asia’s access to Western Canadian crude oil. The disruptions in oil supply due to the U.S.-Israeli conflict with Iran have further boosted demand for Canadian oil, as customers seek alternative sources amidst geopolitical uncertainties.
Anton Malkin, head of research at the University of Alberta’s China Institute, highlighted the trade complementarity between Canada and China, underscoring the significance of their trade relationship amid tensions. Forecasts suggest that Asia could account for 70% of Canada’s oil exports by 2028, indicating a strategic shift in trade dynamics.
The trade dynamics between Canada and China witnessed a pivotal shift in the first half of 2026, marked by significant agreements like the influx of Chinese electric vehicles into the Canadian market in exchange for tariff concessions on Canadian agricultural products. The deal has notably boosted prices for Canadian canola, benefitting local farmers and enhancing trade prospects.
Despite the overall trade growth, imports from China declined by 5.8% year over year, contributing to a reduction in Canada’s trade deficit with China. The shift in manufacturing activities to countries like Vietnam has influenced this import trend, reflecting evolving global trade dynamics.
The trade report authors stress the need for Canada to diversify its export markets and bolster industry-specific growth to ensure sustainable trade expansion. Engaging with the Asia-Pacific region, especially China, presents significant opportunities for Canadian businesses, with a potential to surpass the export targets set for 2030. The upcoming year-end data will provide a comprehensive outlook on Canada’s trade performance with China, indicating a promising trajectory towards achieving export goals.