Canada-China Trade: 2025 Year-in-Review

Dr. Xiaowen Zhang, Senior Researcher, The China Institute, University of Alberta

Dr. Weisu Yu, Postdoctoral Scholar, The China Institute, University of Alberta

• Bilateral Trade Expanded: Canada-China bilateral merchandise trade reached C$124.09 billion in 2025, up 4.9% year-over-year (YoY), driven by a 8% surge in Canadian exports and a modest 1.9% increase in imports. China’s share of Canada’s domestic goods exports rose to 4.6%, while its share of Canadian imports fell for the fifth consecutive year to 11.5%.
• Export Composition Shifted Toward Energy and Minerals: Energy exports rose to C$9.5 billion (↑ 77.8% YoY) and metal ores and minerals to C$7.91 billion (↑ 42.5% YoY), overtaking agricultural exports, which fell to C$5.87 billion (↓ 33.2% YoY) amid Chinese retaliatory tariffs. While C$1.86 billion of canola exports were redirected to alternative markets, exporters absorbed severe price compression, especially in canola seeds and meal.
• Import Composition Revealed Tariff Impacts: Tariff-targeted imports contracted sharply–passenger vehicles fell 68% following Canada’s 100% tariff on Chinese electric vehicles, while imports of steel and aluminum declined 38.8% and 32.2%. At the same time, industrial inputs remained resilient: auto parts imports from China rose 9.9% YoY to C$3.56 billion, and industrial machinery grew 14.9% YoY to C$12.47 billion, with China’s share of Canada’s machinery imports increasing to 13.7%. Consumer goods remained the largest import category from China at C$29.33 billion (↑ 6.4% YoY).
• Provincial Asymmetry Persisted: Canada-China trade remained highly concentrated geographically, with Ontario and British Columbia accounting for 43.2% and 22.9% respectively of total bilateral trade. Exports were concentrated in British Columbia and Alberta, while imports were anchored in Ontario, highlighting a persistent west-to-east structural imbalance in trade exposure to China.

This report draws primarily on Statistics Canada data and applies rigorous processing to present a comprehensive view of Canada–China trade. It provides annual snapshots and trend analysis at aggregate and sectoral levels, contextualizing bilateral trade within Canada’s broader trade performance and its evolving relationships with major partners. Building on this, the report looks closely at goods-level trade patterns to highlight under-reported trends, including how supply-chain linkages are evolving in sectors such as industrial inputs and how exposure to China varies across regions. Together, these analyses identify key risks and emerging opportunities in Canada–China trade going forward. Notably:

1. Bilateral trade expanded, with China’s role evolving in Canada’s trade structure.

Canada–China trade reached C$124.09 billion in 2025 (↑ 4.9% YoY), driven by a surge in exports to China (↑ 13.8%) – in contrast to a modest import growth (↑ 1.9%). Over a five-year horizon, the analysis situates China within Canada’s broader trade landscape, showing that China is becoming a more important export destination even as its role as a supplier declines. This shift contributed to a narrowing bilateral deficit, even as Canada’s overall trade balance deteriorated due to adverse trade dynamics with other partners.

2. Export composition shifted decisively toward energy and minerals amid trade tensions.

Sectoral analysis shows a structural pivot away from agriculture toward energy (↑ 77.8% YoY) and minerals (↑ 42.5% YoY) as leading export drivers. This transition reflects the combined effects of Chinese tariffs on agricultural products, Canada’s domestic infrastructure expansion (notably TMX), and broader geopolitical dynamics. While canola exports collapsed, partial market diversification bore the cost of margin compression, highlighting both vulnerabilities in agriculture and new growth pathways in natural resource exports.

3. Energy has emerged as a central driver of Canada-China exports.

China is an increasingly important destination for Canadian energy and mineral exports. In 2025, energy exports surged to approximately C$9.5 billion (↑ 77.8% YoY), while metal ores and minerals also expanded strongly, together overtaking agriculture as Canada’s leading export categories to China. This shift reflects strong commodity demand and expanding domestic trade infrastructure capacity, further supported by the 2025 launch of LNG Canada. Near-term external factors may reinforce this trend, including geopolitical tensions that have tightened Asian energy markets, positioning energy as a key driver of Canada–China trade going forward.

4. The centre of gravity of Canadian exports to China has shifted westward.

Western provinces, led by Alberta and British Columbia, are gaining prominence as a hub for Canadian exports to China, driven by expanding energy and mineral exports. Export growth has been highly concentrated: Alberta (C$5.73 billion, ↑ 168.6% YoY) and British Columbia (C$510.66 million, ↑ 62.2% YoY) — together accounted for nearly all crude oil exports to China in 2025. This west-tilt trend extends to broader trade patterns. Alberta recorded the largest trade surplus with China, while British Columbia has the highest level of trade intensity with China among all provinces.

5. Import trends diverged across sectors, revealing both tariff impacts and supply-chain adaptation.

Beneath a modest overall import recovery, sector-level analysis uncovers sharp contractions in tariff-targeted goods (e.g., EVs, steel, aluminum), in contrast to resilience in industrial inputs and consumer goods. Imports of auto parts and machinery continued to grow. Notably, product-level trends in direct imports indicate ongoing supply-chain reconfiguration within the industrial inputs category, with strengthening direct procurement channels with Chinese suppliers — a pattern less pronounced in electronics. Diverging sectoral performance highlights uneven exposure to trade tensions, with stronger performance in industrial inputs and capital goods associated with sustained and complementary bilateral supply-chain linkages.

6. Provincial dynamics reveal concentrated trade flows and structurally different regional roles.

Provincial analysis shows that Canada–China trade remains highly concentrated in Ontario and British Columbia. Meanwhile, there is a clear structural divide at the subnational level: resource-driven exports are centred in western provinces, while import demand is disproportionately anchored in central Canada. This chapter also examines sectoral composition and reliance on China, showing that exposure varies significantly across provinces, with British Columbia the most reliant and others more diversified. These patterns indicate the growing geographic and structural asymmetry shaping Canada’s trade relationship with China.

Looking ahead, trade is likely to see selective sectoral re-engagement rather than a broad-based resumption of pre-tension patterns, driven by tariff suspensions covering approximately C$6.6 billion in agricultural exports, continued expansion in energy exports, and quota-based adjustments for Chinese EVs.

Dr. Xiaowen Zhang, Senior Researcher, The China Institute, University of Alberta

Dr. Weisu Yu, Postdoctoral Scholar, The China Institute, University of Alberta