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Canada Wholesale Revenues Up Slightly in June
August 20, 2007
Source: Statistics Canada
Wholesale sales in Canada grew only slightly in June (+0.2%), as increased sales of other products" were largely offset by a decrease in the automotive sector. Excluding the automotive sector, sales grew  ; 0.6%.   ; Wholesale sales for the second quarter were down for the first time in nearly four years. This contraction was largely attributable to the automotive sector.
In June, increases were observed in the "other products" sector (+2.8%), the machinery and electronic equipment sector (+1.0%) and the farm products sector (+6.0%). These advances, however, were partially offset by contractions in the automotive sector (-1.6%) and the personal and household goods sector (-0.8%).
In constant prices, wholesale sales rose  ; 0.1% in June. "Other Products" Continue Rise For a second consecutive month, the sales of "other products" (primarily agricultural products, chemicals, paper products and recycled materials) rose, up  ; 2.8% in June to  ; $5.4  ; billion.
An increase in global demand for products such as fertilizers and fertilizer materials has contributed in part to the recent sales growth in this sector. According to Export Development Canada, substantial increases in crop acreages in the world (for food, biofuels, etc.) are boosting the demand for Canadian fertilizers. The increased demand for fertilizers has also pushed up their prices.   ; Machinery & Electronic Equipment Up After rising  ; 2.3% in May, sales of machinery and electronic equipment grew  ; 1.0% in June. Two groups in this sector were behind June's increase.
Machinery and equipment sales posted a second consecutive increase in June (+2.5%). Despite these recent advances, this group's sales were still below the peak reached in March  ; 2007. This weakness was partly due to a sharp decrease in the activities of the oil and gas exploration industry, which caused it to cut back its purchases of machinery and equipment. The low price of natural gas led exploration companies to scale back their activities considerably, leading to a drop in the number of wells operated.
Wholesale sales of computers and other electronic equipment rose 1.9% in June. This was the seventh increase in nine months for this trade group, which, in  ; 2006, had posted its biggest annual increase since  ; 1999. The strong showing of the cell phone market has in part contributed to the robust sales of this group in recent years. According to the Telecommunications Statistics Survey, at the end of  ; 2006  ; the number of wireless subscribers was up  ; 8.4% compared with  ; 2005  ; to just over  ; 18  ; million.
Wholesale sales of office and professional equipment registered a second decline in three months (-3.1%). The drop in sales only partially offset the advance recorded in May (+5.5%).   ; Automotive Sector Falls Wholesale sales in the automotive sector fell  ; 1.6% to  ; $7.8  ; billion in June, a second decrease in three months. This decline followed the moderate increase observed in May (+0.2%) and the steep drop in sales in April (-8.9%).   ; Wholesale sales of motor vehicles fell  ; 1.9% in June, a second drop in three months. These declines were attributable in part to decreased demand in North America. Exports of both trucks and cars declined for a third consecutive month. Wholesalers also moderated their purchases, as car imports also declined for a third consecutive month.
Wholesale sales of motor vehicle parts also declined in June (-0.5%). This drop more than offset the  ; 0.2% increase registered in the previous month. Wholesalers in this industry, who mainly sell to retailers and dealers, have seen their sales remain generally stable since March  ; 2004.