Canada–China Trade in H1 2026: Resource-Led Export Growth and Selective Re-Engagement

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Executive Summary 

This report assesses merchandise trade between Canada and China during the first half of 2026. The period marked a clear divergence in bilateral flows: Canadian exports to China rose sharply, while imports from China declined. Beneath that aggregate shift, export growth was concentrated in energy and minerals, selected agricultural products began responding to renewed market access, and import performance was split between weaker consumer electronics and stronger machinery, batteries, and vehicles. Provincial outcomes were equally uneven, with export gains concentrated in Alberta and British Columbia and the decline in imports centred in Ontario. Together, these developments point to a trade relationship that is expanding selectively rather than uniformly.

Highlights

• Exports Drove Bilateral Trade Growth: Canada–China merchandise trade reached C$66.60 billion in H1 2026, up 3.6% year-over-year. Exports rose 30.1% to C$21.74 billion, while imports fell 5.8% to C$44.86 billion. The customs-basis merchandise trade deficit consequently narrowed by 25.2% to C$23.12 billion.
  
  
• Energy and Minerals Dominated the Export Expansion: Energy products accounted for 35.8% of domestic exports to China in H1 2026 and grew 81.8% year-over-year. Metal ores and non-metallic minerals represented a further 22.6% and grew 29.0%. Together, the two categories made up 58.4% of domestic exports to China. Consumer goods also recorded strong growth, rising 29.9% to C$1.06 billion.
  
  
• Crude Oil and Copper Drove Product-Level Export Growth: Total crude petroleum exports to China more than doubled to C$5.96 billion, an increase of C$3.20 billion from H1 2025. Copper ore and concentrate exports rose by C$949 million to C$2.64 billion year-over-year.
  
  
• Tariff Relief and Restored Market Access Supported Selected Agricultural Exports: Canola seed exports increased 19.4% to C$1.42 billion following China’s tariff reduction, while pea exports rose 39.6% to C$282 million after the additional tariff was suspended. Frozen boneless beef exports rebounded from approximately C$0.5 million to C$156.6 million following restored market access. Lobster exports nevertheless remained below their H1 2025 level, indicating an uneven response across affected products.
  
  
• Import Declines in Consumer Goods and Electronics Masked Industrial Growth: Consumer goods fell by C$2.02 billion (13.5%, year-over-year) and electronics by C$1.49 billion (14.4%, year-over-year), explaining most of the import decline. Meanwhile, industrial machinery rose by C$1.21 billion (18.6%), motor vehicles and parts increased 9.3% to C$2.91 billion, and farm and food products grew 89.1% from a small base. This divergence reflected a shift in Canada’s import mix rather than a uniform retreat from Chinese supply.
  
  
• Provincial Outcomes Became More Polarized: Alberta and British Columbia recorded the largest export gains, representing 92.3% of Canada’s net increase in exports to China year-over-year, driven overwhelmingly by energy and mineral products. Ontario accounted for the largest import decline, with weaker consumer goods and electronic equipment explaining more than 90% of the contraction.