Wales made promising start but Canada secured four-try bonus and led 28-0 at half-time thanks to McKinley Hunt's double and scores by Alysha Corrigan and Asia Hogan-Rochester.
Welsh number eight Georgia Evans yellow-carded for a high tackle in 48th minute, followed by Taylor Perry and Brittany Kassil going over for Canada.
After heavy loss to Scotland in opening match, Wales were nilled and are set for a group-stage exit.
Canada, ranked second in the world, have shown their credentials as challengers for the trophy by cruising past Fiji and Wales.
Live Reporting
Postpublished at 22 mins
22 mins
Canada 7-0 Wales
Siwan Lillicrap Former Wales captain
There's a huge amount of experience in the front row for Canada, it is the polar opposite maybe to the Welsh front row.
Rachel Taylor Former Wales captain and coach on BBC Radio Wales
In the first few minutes we've seen Wales being physical, showing intent and putting a bit of pride back.
Everyone knows how hard this game is going to be, but in terms of a response from the end of the Scotland game, it is exactly what Sean Lynn would've wanted.
They [Canada] are adventurous, they are brave, they want to move the ball.
They are an exciting attacking team and they are not afraid early on in this game. Even though it's Wales dominance at the moment they are not afraid to get the ball to those wide channels.
Wales full-back Nel Metcalfe produces an inventive kick towards the Canada line and it only just eludes wing Lisa
Neumann as the ball agonisingly rolls into touch.