Canada’s effort to diversify its trade faced a sharp monthly reversal in August 2026, as goods exports to non-U.S. markets fell 8.5% while shipments to the United States rose 8.1%.
Statistics Canada data cited by Global Affairs Canada put U.S.-bound goods exports at C$54.3 billion for the month. The portion of Canadian goods exports going to non-U.S. destinations fell from 33.9% in July to 30.2% in August. The steepest declines included unwrought gold shipments to the United Kingdom, energy products to the Netherlands, and aircraft and crude oil to France. Overall goods and services exports increased 2.1% in August, the department reported.
Global Affairs Canada said U.S. importers may have brought purchases forward after the announcement of Section 338 tariffs on some Canadian goods. The tariffs took effect Aug. 22, and Canada announced retaliatory tariffs Aug. 25. The department said the timing may help explain the stronger U.S.-bound shipments.
The annual figures show a broader shift, though the United States remains Canada’s main export market. Global Affairs Canada said exports to non-U.S. destinations rose 11.1% in 2025, taking their share of Canadian exports to its highest level since 1981. The United States received 72% of Canadian goods exports and 53% of service exports that year. The department linked part of the increase to demand for gold, crude oil, aluminum and canola.
Budget 2025 set a 2035 goal to double Canada’s goods and services exports to markets outside the United States, which the government valued at C$300 billion in additional trade. The Spring Economic Update reported that these exports were C$33 billion higher in 2025 than in 2024.
In its third-quarter survey, the Bank of Canada found that responses gathered after trade talks with the United States collapsed reflected lower confidence and weaker expected export sales. About 75% of interviews took place before the breakdown. Some firms reported changing suppliers, exploring other markets or reducing capacity. Steel and auto firms were especially likely to cut investment in Canada or shift it abroad. Roughly half of firms facing above-normal cost increases planned to pass at least part of the added expense to customers.
The federal government named the proposed Pacific Link pipeline a project of national interest on Oct. 1. It says the project could enable an additional one million barrels of oil per day to reach Asian markets; consultations and project conditions remain under development, with final conditions targeted for Sept. 1, 2027. Statistics Canada is scheduled to release September merchandise trade data Nov. 4.
