03/01/2013 05:28 EST | Updated 05/01/2013 05:12 EDT

Fast Facts on Trade in 2012

Normally, this column is forward-looking, but occasionally, it pays to reflect on recent events. Annual merchandise trade data for 2012 are hot off the press, and analysts are still dissecting the details. Here are some key features of 2012, and reflections on their impact on Canada's trade scene.

Exports still haven't fully recovered. Although post-crisis growth in merchandise exports has on the whole been remarkable, modest 1.9% growth during 2012 still left them 6.2% below the 2008 peak. The main reason? Exports to the US, which remain 10% below the previous peak. At the outset of 2012, exports were expected to have a much better year. They entered 2012 with a lot of momentum, but that fizzled mid-year as global pessimism weighed on sales, and never really regained their verve.

The shift to emerging markets continues. Collectively, Canadian merchandise exports to non-OECD countries grew 4.6% in 2012, outpacing the 1.5% of OECD exports, and lifting the non-OECD share to 11.5%. Diversification of trade to non-traditional markets is still alive and well, and is expected to remain a critical feature of the Canadian trade space well into the future.

China is now the number 2 destination for Canadian goods. That's the spot the UK has occupied for the past 5 years, but China bumped them out of the spot, likely for good, with 16% growth last year. China didn't see an unusual surge; it merely continued the trend. That's not to say that export growth to the UK has been shabby; unlike exports to other OECD countries, shipments to the UK have averaged 16% growth over the past decade. But exports to Britain blinked in 2012, falling 1.6%.

Things were not rosy in all emerging markets. Troubles in the Brazilian and Indian economies during the year translated into atypical double-digit drops in Canadian exports. Hong Kong and Taiwan saw similar declines, but the 27% drop in exports to South Korea -- Canada's seventh-largest merchandise export destination -- was the steepest decline of the bunch. While shocking, these declines are not expected to persist.

Primary product sales were outgunned by high-end goods. Collectively, exports of primary goods and primary manufactures slid 2.4% during 2012, weighed down by oil and gas, metals and pulp shipments. In contrast, high-end exports rose 14%, thanks to vibrant auto- and aerospace sales.

Consistent, solid export growth generally came from emerging markets. China topped the charts on this measure, but Colombia, ranked 25th in value of goods shipped, was actually number 2 in strength and consistency. Australia, the highest-ranked OECD country on this score, wasn't far behind Colombia. Mexico and the US were next on the list, with very similar scores.

Imports have recovered. In fact, that was last year's news, but buoyant Canadians again powered imports ahead, now 6.4% above the 2008 peak. Aided by a strong loonie and cross-border shopping, imports from the US edged above their 2008 peak for the first time. Growth in imports was strongest from Japan and Germany, while France and the UK sustained large losses.

The bottom line? On the trade front, by and large 2012 was a forgettable year. Things look brighter for 2013. US private sector growth is surprisingly strong, and emerging market sales will revive. Sales volumes should do well, although weaker prices will take some shine off the overall numbers.