Canadian manufacturing sales fell 2.1 percent to $49.8 billion in April, the third decline in four months, according to Statistics Canada. The decline in April reflected lower sales of food, aerospace products and parts, and petroleum and coal products.
Sales fell in 8 of 21 industries, representing nearly two-thirds of total Canadian manufacturing. Constant dollar sales fell 1 percent, indicating that a lower volume of goods was sold in April.
Sales of food dropped 5.7 percent in April, the largest monthly decline since August 2013, when sales fell 6.7 percent. The decrease followed a 3.4 percent gain in sales in March. Sales were lower across the industry as unadjusted sales declined in all nine food manufacturing sub-industries. The largest declines occurred in the dairy product and meat product sub-industries.
Production in the aerospace industry fell 17.8 percent in April after rising 40.1 percent in March. The decrease reflected the appreciation of the Canadian dollar in April that reduced the value of sales and inventories in the industry. Because of the volatile nature of aerospace production, examining production levels over three-month periods provides better insight into the industry. Production for the three months ending in April was $4.7 billion, down 13.7 percent from the three months ending in January, and the lowest level since the three months ending in June 2014.
Sales of petroleum and coal products declined 2.7 percent in April, following two months of gains. Lower prices and volumes contributed to the decrease. The lower sales in April reflected shutdowns in the industry for turnarounds to summer fuels that generated a larger than usual drop in sales.
Partially offsetting the declines were increases in a majority of industries, including chemicals, computer and electronic products, and plastics and rubber products.
Sales fell in every province except Manitoba in April, with nearly two-thirds of the national sales decline attributable to Quebec.
Sales in Quebec were down 5.4 percent to $11.7 billion, the largest monthly decline in the province in two years. Sales in April were 8.9 percent lower than their post-recession peak of $12.9 billion in September 2014. This was the second time in three months that provincial sales fell by more than 5 percent. The largest declines occurred in the aerospace and food industries.
In Alberta, sales were down 1.7 percent, reflecting lower sales by machinery and petroleum and coal product manufacturers. Machinery sales in the province have fallen for four months and were at their lowest level since December 2012. The decline in the petroleum and coal product industry was linked to partial shutdowns at refineries for turnarounds to summer fuels. The partial shutdowns reduced sales in the industry more than in other years.
Ontario manufacturing sales were down 0.4 percent in April, the third decline in four months. Over those four months, sales have fallen 4.2 percent. Sales in Ontario have been trending downward since the beginning of 2015 and were 6.1 percent lower in April than their post-recession peak posted in July 2014. Lower sales of food and motor vehicles were the largest contributors to the decline.
Manitoba was the lone province to report an increase in April, with sales up 3 percent. This was the third gain in five months in the province. The increase reflected higher sales of transportation equipment.
The inventory-to-sales ratio rose from 1.41 in March to 1.45 in April. The inventory-to-sales ratio measures the time, in months, that it would take to exhaust inventories if sales were to remain at the current rate.
The value of unfilled orders fell 2 percent in April, largely as a result of lower unfilled orders in the aerospace industry. The vast majority of unfilled orders in the industry are held in US dollars. From the end of March to the end of April, the value of the Canadian dollar appreciated 4.4 percent, thereby reducing the Canadian-dollar value of the orders held in US dollars. Also contributing to the decline in total unfilled orders were the machinery, other transportation equipment and fabricated metal product industries.
New orders fell 5.6 percent in April, reflecting declines in the transportation equipment industry, particularly the aerospace product and parts sub-industry. The higher value of the Canadian dollar was the primary factor in the decline.
