Canadian International Merchandise Trade (Customs Basis)

Detailed information for May 2002

This activity is conducted to provide statistical information and analysis of the value of Canada's merchandise exports and imports by commodity and by partner country.

Data release - July 19, 2002

• Description
• Data sources and methodology
• Data accuracy

Description

This activity is conducted to provide statistical information and analysis of the value of Canada's merchandise exports and imports by commodity and by partner country.

Information on imports and exports are inputs into the Canadian System of National Accounts, particularly in the Balance of Payments and Gross Domestic Product, and are used in the formulation of trade and budgetary policies. Governments, importers, exporters, manufacturers and shipping companies use trade statistics to monitor import penetration and export performance, monitor commodity price and volume changes and examine transport implications.

Reference period: Month

Collection period: Calendar month

Subjects

• Balance of international payments
• Economic accounts
• International trade
• Merchandise exports
• Merchandise imports

Data sources and methodology

Instrument design

This methodology does not apply.

Sampling

This methodology does not apply.

Data sources

Data are extracted from administrative files.

Canadian trade statistics are compiled according to the "General" system of trade as defined by the United Nations Statistical Office. The general trade system, in principle, presents all goods entering the country (imports) and all goods leaving the country (exports). It differs from the "Special" system of trade in the treatment of imported goods into Customs bonded warehouses. Under the special trade system, these goods are counted only if and when they are withdrawn from Customs warehouses for home consumption. They are not counted in export statistics unless they have first cleared Customs.

Import data are captured by Canada Customs and Revenue Agency from B3 forms and from electronic import transaction entries. Data for Canadian exports to countries other than United States are compiled by the International Trade Division from B-13A forms received via the CCRA and from Summary Reports and Canadian Automated Export Declarations (CAED) submitted directly to Statistics Canada.

Canadian exports to the United States are compiled using United States import statistics (from the U.S. Customs Service via the U.S. Census Bureau) and account for approximately 85% of the value of Canada's export trade.

Error detection

Validation, combination, unit value and 'reasonableness' edits are performed on both imports and exports data during the edit and imputation process. Validity checks ensure that a reported variable respects its defined characteristics, e.g., numeric variables are reported as numeric, valid codes have been provided, etc. Combination edits include commodity/country, commodity/trader and commodity/province. Unit value lows and highs are calculated for each Harmonized System (HS) code. Data that fall within this range are accepted while those that fail are rejected.

Imputation

Both manual and automated imputations are performed on imports and exports data. If manual corrective action is required, often a link to the electronic invoice will suffice to obtain the necessary information. Otherwise, a follow-up with the importer, exporter or their representative, the broker is carried out.

Data that fail the edits and are below a value threshold are automatically imputed. In the case of a unit value failure the quantity is the variable automatically imputed. Quantity is imputed by randomly selecting a unit value between a high and a low unit value range.

Estimation

Import and export values are disseminated in Canadian dollars and can require conversion from reported currencies. Foreign currencies are converted using the Bank of Canada monthly average based on the daily noon rates.

There are two currency conversion processes involved in Canada's export transactions to the U.S. Imports must be reported to the U.S. Customs agency in U.S. dollars for accounting. In turn, these data (in U.S. dollars) are transmitted to the USCB which converts them to Canadian dollars prior to transmitting to Statistics Canada.

Export data for natural gas and electricity are estimated for the current and previous months as this information is not received from source in time.

Quality evaluation

Transaction-level data are aggregated and subjected to month over month and year over year analysis to detect errors and explain observed movements.

The models used to seasonally adjust are reviewed annually by the Economic Statistics Methods Division of Statistics Canada.

Disclosure control

Import and export statistics with countries other than the United States are derived from information contained on administrative records collected by the Canada Customs and Revenue Agency under the Customs Act. Copies of these documents (or information therefrom) are sent to Statistics Canada in accordance with Section 25 of the Statistics Act. The disclosure of trade statistics is therefore governed by both the Customs Act and the Statistics Act and is subject to the provisions of Section 17(2)(a) of the latter. Disclosure of export statistics to the United States is now governed by a Memorandum of Understanding which provides for an exchange of detailed import statistics between Canada and the United States.

International Trade Division's method to suppress confidential data differs from that of most other Statistics Canada divisions. The majority of divisions use what is termed 'active suppression' as opposed to the ITD use of 'passive suppression'. 'Active suppression' requires the review of data to determine the confidentiality status of data prior to dissemination, while 'passive suppression' only requires that data be suppressed following the receipt of a valid notification that ITD data contain information that is confidential.

Revisions and seasonal adjustment

In general, merchandise trade data are revised on an ongoing basis for each month of the current year. Customs basis data are revised for the previous data year each quarter.

Factors influencing revisions include late receipt of import and export documentation, incorrect information on customs forms, replacement of estimates with actual figures, changes in classification of merchandise based on more current information, and changes to seasonal adjustment factors.

Both export and import statistics show large monthly fluctuations. In order to isolate turning points or trends in the basic data, it is necessary to eliminate this
effect of seasonal movement. Statistics Canada uses the X-11-ARIMA (Dagum, 1975 and 1979) method to
remove seasonal fluctuations from time series.

A full description on seasonal adjustment is provided in the attached document.

• Additional documentation

Data accuracy

The administrative data used to compile trade statistics is considered to be complete and accurate. Any anomalies or inconsistencies detected are verified with the source, and where necessary, adjustments are made to reconcile data with the conceptual framework of the series. The administrative agencies used are considered to be the best source available.

It is not unusual for the accuracy of export statistics to be adversely affected by undercoverage and/or country misallocation. While Statistics Canada does not have a direct measure of undercoverage, a monthly estimated adjustment is included within balance of payments based data. Country misallocation occurs when the country of final destination is inaccurately reported on the Customs documentation. This occurs most frequently when goods are routed through an intermediary country before continuing to their final destination with the intermediary country being reported as the final destination of the goods.