Canada's manufacturing sales edged down 0.1% in April from March to C$50.9B, the first decline in four months; 14 of 21 industries, representing about 60% of manufacturing, posted gains despite slight decrease in total sales: Statistics Canada

Cindy Allen

OTTAWA , June 13, 2014 (press release) – Manufacturing sales edged down 0.1% in April to $50.9 billion, the first decrease in four months. Declines in the petroleum and coal product, aerospace product and parts, and machinery industries were largely offset by smaller gains in most other industries.

In April, 14 of 21 industries representing about 60% of manufacturing posted gains, despite the slight decrease in total sales.

Constant dollar sales rose 0.4% in April, indicating an increase in the volume of goods sold.

Sales decrease in the petroleum and coal product industry

Sales in the petroleum and coal product industry decreased 5.0% in April to $6.9 billion. The decline was caused by partial shutdowns at several refineries for maintenance and retooling work. Although such work is common during the spring months, the partial shutdowns were more extensive than usual in April.

Production in the aerospace product and parts industry dropped 6.2% to $1.5 billion in April, following three months of gains. Despite the decline in April, total aerospace production in the first four months of 2014 was $6.2 billion, up 15.5% from the same period in 2013.

The machinery (-3.2%) and chemical (-1.7%) industries also posted lower sales in April. In both industries, sales declines were widespread.

Sales in the paper industry rose 12.1% in April to $2.2 billion, the largest percentage increase since the current series began in 1992. Several paper manufacturers reported higher sales in April following the resolution of the Port Metro Vancouver strike at the end of March.

In the motor vehicle industry, sales rose 3.3% to $4.4 billion. Sales in the motor vehicle parts industry also rose, increasing 2.6% to $2.2 billion, the eighth gain in nine months. As a result, sales in the motor vehicle parts industry reached their highest level since October 2007.

Quebec manufacturers post the largest decline

Sales were down in five provinces in April, with Quebec posting the largest decrease.

Quebec manufacturing sales fell 2.3% to $11.9 billion in April. The decline was mainly caused by a drop in petroleum and coal product sales and lower production in the aerospace product and parts industry. The decreases were partly offset by higher sales in the paper, plastics and rubber products, and food industries.

Sales in New Brunswick dropped 4.5% to $1.4 billion in April, the sixth consecutive monthly decline. Since reaching a peak of $1.9 billion in October 2013, sales in the province have fallen 27.4%. The decline in April was a result of lower non-durable goods sales.

In Ontario, sales rose 0.6% to $23.5 billion, the highest sales level since July 2008, before the most recent economic downturn. The gain in April largely stemmed from higher sales in the motor vehicle and motor vehicle parts industries.

Sales in British Columbia advanced 2.8% to $3.5 billion in April. Most of the gain reflected higher paper sales following the resolution of the Port Metro Vancouver strike.

Saskatchewan manufacturing sales increased 6.6% to $1.4 billion, largely as a result of gains in the non-durable goods industries.

Inventories rise

Inventories rose 1.1% to $72.4 billion in April, the fourth consecutive monthly gain. The increase mostly stemmed from higher inventories of petroleum and coal products, machinery, and aerospace products and parts. The gains were partly offset by a decrease in the computer and electronic product industry.

In the petroleum and coal product industry, inventories increased 3.9% to $7.5 billion. The gain was mostly caused by higher inventories of raw materials on hand.

Machinery inventories rose 3.3% to $6.7 billion in April, the third advance in four months. Aerospace product and parts inventories also rose, increasing 2.1% to $8.2 billion. The gain in aerospace inventories was almost entirely caused by higher goods in process.

In the computer and electronic product industry, inventories fell 5.0% to $3.2 billion. A decrease in raw materials held by manufacturers was the principal factor behind the decline.

The inventory-to-sales ratio rose from 1.41 in March to 1.42 in April. The ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.

Unfilled orders increase

Unfilled orders rose 0.5% to $89.7 billion in April, largely as a result of an advance in the machinery industry. Unfilled orders in the machinery industry rose 4.8% to $6.7 billion on the strength of widespread gains.

In the transportation equipment industry, unfilled orders edged down 0.2% to $65.4 billion in April, offsetting some of the gain in the machinery industry. The decrease partly reflected a slight decline in the value of the US dollar relative to the Canadian dollar over the course of the month. Most unfilled orders in the transportation equipment industry are held in US dollars. In April, unfilled orders in this industry accounted for almost three-quarters of total manufacturing unfilled orders.

New orders rose 2.5% in April, largely because of gains in the transportation equipment, machinery, and paper industries.

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