As we brace for what could be a bumpy ride for Alberta’s exporters once President-elect Trump takes office later this month, the numbers trickling in from last year highlight the importance of Alberta’s exports to the United States. (Statistics Canada released data on international merchandise exports for the month of November this morning.)

Of the $166 billion worth of goods sold to international customers over the first 11 months of the year, $147 billion (89%) went to the U.S.

On the bright side, year-to-date (YTD) sales to international customers were 3.4% higher than the same period in 2023 with a rise in energy product exports more than offsetting a drop in crop sales. This puts export values in 2024 on pace to be the second highest on record, supplanted only by 2022 when commodity prices surged following Russia’s invasion of Ukraine.

The concern is that new U.S. tariffs would, if implemented, cut into the value of Alberta’s sales next year.

Our forecast assumes a 10% U.S. tariff, but with oil and gas excluded on the grounds that it would increase energy costs for U.S. consumers (something Trump would not welcome). However, if a blanket 25% tariff is imposed, we see the volume of Alberta’s exports taking a hit and real GDP contracting by 0.3% this year.

With energy products accounting for more than three-quarters of Alberta’s international merchandise exports, energy prices are, as always, a key wildcard.

Our December forecast assumes that oil prices soften somewhat next year while natural gas prices improve.

The downside risk is that oil prices experience a sustained slump due, for example, to OPEC+ deciding to increase production more than expected.

Prices could also go the other way and push Alberta’s nominal gains from exports significantly higher. The likely cause in this case is a disruption in energy supply brought on by geopolitical conflict.

From trade disputes and bad weather to pandemics and oil price wars, Alberta is used to a bumpy ride when it comes to selling its wares internationally. Despite the potential for more turbulence going forward, the additional crude oil pipeline capacity and west coast access provided by the Trans Mountain expansion, new LNG export options, and ongoing demand for Alberta products bode well overall. At the same time, a lower loonie will help cushion the ride in the short-term as exporters receive more Canadian dollars for sales priced in U.S. currency.

Our base case forecast sees Alberta export volumes rising by over 3% in 2025.

Answer to the previous trivia question: Established in 1966 by the Canadian Dairy Commission Act, the Canadian Dairy Commission regulates the supply of dairy products.

Today’s trivia question: Which U.S. state bought the most electricity (by dollar value) from Alberta in 2023? (2023 is the most recent year for which we have 12 months of data.)