Canada’s trade with the United States fell to “one of the lowest levels on record” in May as a result of the severe trade war launched by U.S. President Donald Trump, the national statistical agency reported, AFP said.

Nevertheless, Canada managed to partially offset the decline by increasing shipments to other countries. While exports to the United States decreased for a fourth consecutive month, exports to other nations reached “a record high,” Statistics Canada noted.

As a result, the share of Canadian exports destined for the U.S. dropped from a monthly average of 75.9% to 68.3%. The agency pointed out this was “one of the lowest levels recorded so far.”

Imports from the United States also fell for a third consecutive month. Consequently, Canada’s trade surplus with the U.S. slightly increased, reaching 2.4 billion U.S. dollars.

The government of Prime Minister Mark Carney and the Trump administration are engaged in intense negotiations in an effort to reach an agreement that would prevent further tariff hikes. Trump has already imposed steep tariffs on imports of automobiles as well as steel and aluminum — two metals that have traditionally been among Canada’s key export goods to the U.S. The North American automotive industry is also highly integrated.

Carney set a deadline of July 21 for concluding a new trade agreement. If no deal is reached, he announced that Canada would adjust its 25% counter-tariffs on American steel and aluminum — in response to the recent doubling of U.S. tariffs on these metals to 50%.

In May, total Canadian exports rose by 1.1%, driven mainly by an increase in gold shipments to the United Kingdom. Canada also exported more oil to Singapore, aluminum and pharmaceutical products to Italy, and pork to Japan. This growth was partially offset by a decline in exports of canola and oil to China.

Meanwhile, total imports fell by 1.6% as imports of motor vehicles and parts continued to decrease. As a result, Canada’s trade deficit with the rest of the world narrowed from a record 7.6 billion Canadian dollars in April to 5.9 billion in May. |BGNES