Canadian Manufacturing Sales Up 2% in November

Canadian manufacturing sales rose 2 percent in November to $49.6 billion, the fourth increase in five months, according to Statistics Canada. The gains reflected higher sales in the machinery, petroleum and coal product, and motor vehicle industries.

Constant dollar manufacturing sales rose 1.7 percent, also the fourth increase in five months.

Higher sales were reported in 14 of 21 industries, representing approximately 80 percent of Canadian manufacturing. Both durable (+2.4 percent) and non-durable goods manufacturers (+1.5 percent) reported gains.

By Industry
The machinery industry reached its highest sales level ever in November, with sales rising 13.4 percent to $3.4 billion. The growth was mostly concentrated in the mining and oil and gas field machinery manufacturing industry, where a number of companies completed large projects for delivery to both domestic and international customers.

Sales in the petroleum and coal product industry advanced 3.9 percent to $7.6 billion, the fourth increase in five months. The gains partly reflect higher production following maintenance and retooling work over the summer and fall 2011.

Motor vehicle sales rose in November with manufacturers reporting a 7.1 percent increase to $4.1 billion. Sales have advanced 24.9 percent since a low-point reached in June 2011. These gains reflect a partial resolution of the supply chain problems during the summer and fall 2011.

The overall sales increases were somewhat offset by declines in the computer and electronic product industry, down 11.0 percent to $1.2 billion.

By Province
Manufacturing sales rose in nine provinces in November, with Ontario, Alberta and Newfoundland and Labrador posting the largest provincial increases in dollar terms.

In Ontario, manufacturers reported a 2.0 percent increase in sales to $22.5 billion. The motor vehicle, aerospace product and parts, and machinery industries were the main contributors to the gain.

Manufacturers in Alberta reported a 5.9 percent rise in sales to $6.4 billion, the largest percentage increase since May 2008. Gains in November were focused in the machinery, and petroleum and coal product industries.

Sales rose 20.8 percent to $640 million in Newfoundland and Labrador, reflecting substantial gains in the non-durable goods industries. Manufacturing sales in Newfoundland and Labrador were the highest since July 2008.

New Brunswick (-4.0 percent) was the only province with a decline in sales.

Inventory
Inventory levels rose 0.4 percent in November to $65.1 billion. This is the 14th consecutive month of inventory growth in Canada.

Inventories were up in 8 of 21 industries, with non-durable goods posting a 0.8 percent increase and durable goods manufacturers reporting a 0.1 percent rise.

The largest inventory gain was in the computer and electronic product industry, where a 5.9 percent increase stemmed largely from a rise in raw materials.

Food inventories advanced 2.6 percent, also largely a result of increases in the inventories of raw materials.

Inventory-to-Sales Ratio
The inventory-to-sales ratio declined to 1.31 in November from 1.33 in October. The inventory-to-sales ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.

Unfilled Orders
Unfilled orders increased 1.2 percent in November to $62.2 billion, the 10th increase in 11 months. The gain in unfilled orders was led by the aerospace product and parts industry, where the backlog of orders rose 4.0 percent to $29.7 billion.

Unfilled orders were also up in the primary metal (+13.3 percent) and fabricated metal product industries (+2.0 percent).

New Orders
New orders increased 3.6 percent in November after declining 3.9 percent in October. The gain largely reflected a rise in the aerospace product and parts industry.