OTTAWA
Canadian exports to China are hitting record highs as Prime Minister Mark Carney prepares for a trip to meet Chinese President Xi Jinping next week.
Third-quarter figures compiled by the China Institute at the University of Alberta show total two-way trade reached $36.78 billion, the highest quarterly level on record, driven largely by energy and agricultural shipments.
"Our exports are going to hit record highs this year, and the numbers are accelerating," said Philippe Rheault, director of the China Institute.
The trade surge marks a sharp turnaround from the low point in Canada-China relations that followed the detention of Canadians Michael Kovrig and Michael Spavor in China after the 2018 arrest of Huawei executive Meng Wanzhou in Vancouver.
Trade increased after an agreement last January that saw Ottawa secure lower Chinese tariffs on Canadian goods in exchange for allowing Chinese electric vehicles into the Canadian market.
Crude oil exports to China jumped 159 percent, averaging 327,000 barrels per day, with much of the increase attributed to additional capacity from the Trans Mountain pipeline.
"I think a lot of experts were predicting that most of the Canadian crude that made it to tidewater would actually end up going to California and not going to Asia. That’s been disproved emphatically, and it’s almost all going to East Asia, and the majority of that is going to China," said Rheault.
The figures also point to an easing of Chinese tariffs on Canadian agricultural products.
Canola meal exports rose to $360.3 million from $12.9 million a year earlier. Pea exports increased to $147.6 million from $9.2 million, while beef exports reached $181.4 million after being virtually non-existent a year ago.
While most provinces recorded higher exports to China during the quarter, Alberta and Saskatchewan accounted for nearly 78 percent of the overall increase.
National domestic exports to China increased by roughly $4.32 billion year-over-year, with Alberta’s surge driven mainly by crude oil exports and Saskatchewan’s by canola meal, canola seed, potash and peas.
Some China experts cautioned that boosting trade with China comes with risks Canadian producers know well.
Vina Nadjibulla, CEO of the Centre for Strategic Statecraft, said nearly 70 percent of Canada's canola seed exports went to China in 2024, giving Beijing significant leverage it has used during political disputes.
She said Canada should expand trade with China while continuing to develop other markets, with the goal of reducing strategic dependence, not simply shifting it from one major power to another.
Rheault said the numbers demonstrate the impact of Canada’s renewed engagement with China and a shift in federal policy.
"I think some observers are still going to be surprised at how forward leaning the prime minister and his government are when it comes to engaging with China at a time when the United States may be reconsidering its approach to Canada," said Rheault.
Even with higher exports to China, Canada still exports about ten times as much product to the United States.
Carney’s goal is to double exports of Canadian goods and services to non-U.S. markets by 2035, and China is expected to play a large role.
Carney leaves Wednesday for a whirlwind tour of Asia that includes stops at the ASEAN summit in the Philippines, the APEC summit in China, where he is expected to meet Xi, and the Francophonie summit in Cambodia.
The trip will mark Carney’s second visit to China as prime minister.
This story was written by the e2gold.ca newsroom from reporting by BNN Bloomberg and CTV News. Quotes are checked word for word against that reporting.