Energy’s eight-year run as Canada’s biggest export is over.
A Statistics Canada report Thursday showed shipments of motor vehicles surpassed those of energy in July for the first time since 2007, as oil prices plunged and demand for cars in the U.S. accelerates.
The value of motor vehicles and parts shipped abroad was C$7.6 billion ($5.7 billion) in July, the most since 2006. Within the category, exports of passenger cars and light trucks were also the highest since 2006.
Exports of energy products fell to C$7.3 billion, down 39 percent since the beginning of 2014.
The end of energy’s dominance, at least for one month, will be a relief for policy makers such as Bank of Canada Governor Stephen Poloz and Prime Minister Stephen Harper. They’ve been waiting eagerly for the rebound in non-energy exports, driven by a weaker currency and stronger U.S. demand, that Poloz has said will soon be the “dominant trend” of the economy by the second half of this year.
Poloz had already begun to hedge against that prediction. In July, the Bank of Canada cut its key interest rate for a second time this year to fuel growth, blaming the “puzzling” weak non-energy exports.
Now the pieces appear to be falling into place. Non-energy exports have increased 10 percent in June and July, the biggest two-month gain since 2004.