Canadian exports to China surged by 30% in the first half of 2026, contributing to an overall trade increase of 3.6% year over year, as per data analyzed by researchers from Statistics Canada. The findings, detailed in a recent report by the Canada China Business Council and the University of Alberta’s China Institute, signal a reinvigoration of trade between the two nations amidst Canada’s efforts to diversify its economy amid strained relations with the U.S.
Trade in goods between Canada and China reached $66.6 billion in the first half of 2026, marking a 3.6% rise, with exports growing by 30% to $21.74 billion year over year. Notably, energy and minerals were the primary drivers, comprising 58.4% of domestic exports to China during that period. Energy exports, particularly crude oil and liquefied propane, surged by 81.8%, while exports of metal ores and non-metallic minerals, including copper ore, increased by 29%.
The recent uptick in trade is attributed to a combination of factors, including the easing of diplomatic and economic tensions between Canada and China following the arrest of Huawei executive Meng Wanzhou in 2018. Amid escalating trade conflicts with the U.S., Canadian Prime Minister Mark Carney has emphasized the country’s intention to forge new trade agreements with other nations and reduce reliance on American trade.
Furthermore, the expansion of the Trans Mountain Pipeline, which reached 97% capacity in June, has significantly boosted Asia’s access to Western Canadian crude oil. Disruptions in oil shipments due to geopolitical conflicts, such as the U.S.-Israeli war on Iran, have further propelled customers to turn to Canadian oil producers. Mark Maki, CEO of Trans Mountain, projected that Asia could account for 70% of Canada’s oil exports by 2028.
In a notable development, Carney brokered a deal with Chinese President Xi Jinping to allow a substantial number of Chinese electric vehicles into the Canadian market in exchange for tariff concessions on Canadian agricultural products. This agreement has positively impacted the agricultural sector, with prices rebounding for products like canola seed.
While the trade truce with China has driven export gains, imports from China have decreased by 5.8% year over year, contributing to a reduction in Canada’s trade deficit. This decline is partly attributed to a shift in manufacturing activities to countries like Vietnam. Despite the overall positive trends, the report highlights that agricultural exports saw only modest growth, with fluctuations observed in different product categories.
Looking ahead, there is a push to diversify trade partnerships and fortify economic relations with the Asia-Pacific region. Canadian exporters are optimistic about expanding engagement with growing markets, with China offering significant opportunities for businesses. The upcoming year-end figures are expected to provide a comprehensive view of Canada’s trade performance with China, positioning the country on track to achieve its export growth targets by 2030 and potentially surpass them.