OTTAWA — Canada’s exports rose 2.8 per cent in February to a record high, driven mostly by energy products, while imports climbed 3.9 per cent from the previous month, data from Statistics Canada showed on Tuesday, with economists anticipating more gains for exports ahead.

The country’s trade surplus with the world narrowed to $2.66 billion (US$2.14 billion), below analyst forecasts of $2.9 billion. But exports came in above expectations at $58.75 billion, with imports at $56.08 billion.

Statistics Canada also said border blockades in February by anti-vaccine mandate protesters had little impact on overall trade activity, with most road shipments rerouted.

“Canada’s trade balance narrowed slightly in February as imports recovered from the previous month’s weakness. However, the bigger story is the recent string of surpluses supported by strength in energy prices,” Shelly Kaushik, an economist at BMO Economics, said in a note.

“Looking ahead, a further surge in commodity prices will continue to buoy exports in March.”

Energy exports rose 7.8 per cent to a record high, making up more than two-thirds of the total increase, while exports of non-energy products were up 1.2 per cent. In volume terms, exports were up 0.6 per cent.

“Exports of crude oil contributed the most to the growth in February 2022, largely due to higher prices,” Statistics Canada said.

Oil prices were climbing even before Russia invaded Ukraine on Feb. 24 and have since surged. Canada is the world’s fourth-largest producer of oil.

The crisis also has pushed up imports, with Canada’s imports of fertilizers, pesticides and other chemicals hitting a record high. Statistics Canada pointed to lower production in China and quotas on fertilizer exports from Russia as contributing factors.

“These events create uncertainty about the availability and the cost of these products, resulting in atypical movements for Canadian fertilizer imports,” it said.

With imports expected to drop back in March and commodity exports to benefit from rising prices, the surplus is likely to widen in coming months, analysts said.

“By our estimates, the terms of trade is now the most favourable on record and points to an improvement in the goods trade surplus to as high as $6.0 billion,” Stephen Brown, senior Canada economist at Capital Economics, said in a note.

“It remains to be seen how much of that extra income will find its way into the rest of the economy,” he added.

The Canadian dollar was trading 0.6 per cent higher at 1.2410 to the greenback, or 80.58 U.S. cents.

© Thomson Reuters 2022