Canadian exports to China surged 30 per cent to $21.74 billion in the first half of 2026, driven largely by energy and mineral shipments. The trade boom coincides with intensifying Canada-U.S. trade tensions and Prime Minister Mark Carney’s renewed push to diversify overseas markets.
Canada’s trade relationship with China underwent a dramatic shift in the first half of 2026, recording a 30 per cent surge in exports as Ottawa actively seeks alternatives to its volatile U.S. market. Overall trade in goods between the two nations reached $66.6 billion, representing a 3.6 per cent increase compared to the previous year, according to Statistics Canada data analyzed by researchers.
The numbers form the core of a new report published by the Canada China Business Council and the University of Alberta’s China Institute. Exports hit $21.74 billion (US$15.63 billion) over the six-month period, marking the highest first-half value recorded since 1997, according to a trade report released by the two organizations.
Energy and Mineral Exports Fuel the Surge
Resource extraction dominated the bilateral expansion. Energy and mineral products accounted for 58.4 per cent of all domestic exports to China during the first half of the year. Energy shipments alone skyrocketed by 81.8 per cent, powered heavily by crude oil and liquefied propane exports.
Meanwhile, metal ores and non-metallic mineral exports—including copper ore—rose 29 per cent, making up 22.6 per cent of shipments. Energy products alone accounted for 35.8 per cent of the shipments, surging 81.8 per cent from a year earlier.
Logistical and geopolitical catalysts cleared the path for the massive resource flow. The Trans Mountain Pipeline hit 97 per cent capacity in June, drastically expanding Western Canada’s crude oil access to Asian buyers. Concurrently, the U.S.-Israeli war on Iran disrupted transit through the Strait of Hormuz, driving global oil prices upward and pushing buyers directly toward Canadian producers.
Geopolitical Shifting and the U.S. Trade Friction
The bilateral thaw follows years of icy relations stemming from the 2018 arrest of Huawei executive Meng Wanzhou on a U.S. extradition warrant. As fresh trade escalations threaten to widen the policy gap between Ottawa and Washington, Prime Minister Mark Carney has pushed aggressively to pivot trade strategies.
Carney made the remarks in a video address delivered hours after retaliatory Canadian tariffs against billions of dollars in U.S. goods took effect. That pivot will come at a cost. There’s always a cost to action. But it doesn’t come close to the cost of standing still,
he added.
The diplomatic pivot also included the spring launch of the China-Canada Financial Working Group, established by Finance Minister François-Philippe Champagne during a diplomatic visit to Beijing.
Tariff Relief and Agricultural Rebounds
The first half of 2026 also brought a formal trade truce. Carney reached an agreement with Chinese President Xi Jinping allowing tens of thousands of Chinese electric vehicles into the Canadian market—resulting in 15,603 EVs entering so far—in exchange for Beijing suspending tariffs on Canadian peas and canola meal, alongside reduced tariffs on canola seed.
The tariff relief provided immediate economic recovery for Western Canadian agricultural producers.
Harpe noted that canola seed prices had slumped as low as $12 a bushel during the height of the trade dispute with China, but have since rebounded to $17 a bushel.
Port Expansion and Shifting Import Dynamics
Provinces like Alberta and British Columbia captured the heaviest export gains. Canada’s largest port facility in Vancouver handles approximately 16 per cent of national merchandise trade, with a full third of those goods moving to or from China.
While exports surged, import figures told a different story. Chinese imports into Canada dropped 5.8 per cent year over year, narrowing Canada’s trade deficit with China by 25 per cent. Researchers attribute the import contraction partly to a broader supply chain realignment that has moved specific manufacturing sectors out of China and into nations like Vietnam.
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