Manufacturing continues growth trend
January 20, 2010
by MM&D Staff
Canada’s manufacturing sales edged up in November, if only slightly.
According to Statistics Canada, sales were up 0.1 percent in current dollars, a moderate showing after a two-percent increase in October. Manufacturing sales increased in five of the six months leading up to the end of November; this suggests that the sector is in recovery mode.
In constant dollars, however, sales decreased 0.8 percent in November—the first decrease in three months. Furthermore, in constant dollars, manufacturing sales were 8.4 percent below November 2008 levels.
Most of the sales gains in November 2009 came from non-durable goods industries.
Sales by chemical manufacturers increased 5.3 percent from October, largely supported by growth in sales of pharmaceuticals and medicine.
Sales of petroleum and coal products climbed 2.9 percent in November, notching the third increase in four months.
Tempering the rate of growth was the transportation equipment industry, which saw sales decline 4.3 percent. Sales of aerospace products and parts continued to be extremely volatile, dropping 15.4 percent after increasing 48.2 percent in October. Following two months of gains, motor vehicle sales fell by 4.5 percent.
Region by region
Across Canada, the results were split. New Brunswick manufacturers had the strongest month, increasing sales by 15.2 percent. Their counterparts in Saskatchewan, Nova Scotia, Alberta and Quebec also experienced moderate sales growth.
On the other side of the ledger, manufacturing sales in Newfoundland and Labrador dropped 9.1 percent in November from October, while in Prince Edward Island sales were down 4.7 percent. Sales dropped 2.9 percent in Manitoba.
Inventories continue to fall
Inventory levels continued to sidestep downwards in November, declining 0.3 percent to $59.7 billion. This marks the 10th decrease in 12 months and places Canada’s inventories 12.2 percent below November 2008 levels.
Inventories fell in 16 of 21 industries, with the steepest drop taking place in the transportation equipment sector.
The inventory-to-sales ratio—which is a measure of the time, in months, it would take to exhaust stock at current sales levels—dropped to 1.40, marking the fifth decline in six months and the lowest ratio since October 2008.
In addition, unfilled orders declined for the fifth consecutive month in November, falling by 1.4 percent to $51.5 billion—the lowest level since March 2007.