Home » Canadian Manufacturing Sales Down 2.7% in March
Canadian Manufacturing Sales Down 2.7% in March
May 14, 2009
Canadian manufacturing sales decreased 2.7% to $41.4 billion in March, reversing February's gain, according to Statistics Canada. With this decrease, manufacturing sales have fallen almost 25% from their peak reached in July 2008, with most of the drop occurring between November 2008 and January 2009. Durable goods industries such as aerospace parts and products, motor vehicle parts, and primary metal products were behind most of the losses in March.
Much of the decline in manufacturing sales was in Quebec, which accounted for slightly over half of the national decrease.
Constant dollar manufacturing sales decreased 2.4% in March to $38.2 billion, indicating that most of the decline was due to a drop in the volume of sales. At the industry level, sales in 15 of 21 manufacturing industries decreased in March, accounting for about three-quarters of total sales.
Durable & Non-durable Goods Durable goods industries reported the strongest decreases in March, down 4.4% from February and the fourth decrease in five months. Aerospace products and parts production pulled down results, falling 32.4% compared with February. A number of cancelled orders prior to March may have factored into the decrease.
Motor vehicle parts sales decreased 17.6% in March, as manufacturers in this industry continued to struggle with the rapidly changing needs of motor vehicle plants.
However, the drop in the motor vehicle parts industry was offset by a 22.2% gain in motor vehicle sales which followed sizeable gains in February. Despite these recent gains, sales by motor vehicle manufacturers remain about 50% below levels from a year and a half ago.
Primary metal manufacturers reported a 7.6% decrease in March. Other than a gain in February, sales in this industry have been sliding downward since last fall. Primary metal manufacturing sales have fallen by about 40% since October 2008.
Non-durable good sales decreased 0.9% in March. Some continued weakness in the petroleum and coal product (-2.1%) and chemical industries (-1.5%), was partially offset by small gains in the food and beverage and tobacco product industries.
By Province Sales in Quebec fell by 6.1% to $10.5 billion, reaching their lowest level since June 2003. Sales in Quebec have been falling since October 2008. A 29.0% decline in aerospace products and parts manufacturing, as well as in primary metals (-9.3%) were behind much of the decrease in March.
In Alberta, manufacturing sales dropped 5.0% to $4.7 billion. A 23.1% decline in the machinery manufacturing industry, stemming from weakening demand for oil and gas field machinery, was a major cause of the provincial decline.
Sales in Ontario decreased 1.5% to $18.9 billion, following a 7.2% gain in February. The main contributors to March's decline were petroleum and coal products (-9.6%), primary metals (-8.1%) and machinery manufacturing (-5.8%).
Manufacturing sales increased 1.0% in the Atlantic provinces. A rise in sales in the petroleum and coal products industry was largely responsible for the increase.
Inventories Inventory levels decreased 1.7% in March to $65.4 billion, the fourth decline in five months. A 2.5% reduction in durable goods inventories was behind most of the decreases. Raw materials (-1.8%), goods in process (-3.0%) and finished product inventories (-0.7%) all declined in March. From an industry perspective, 17 of 21 industries reported lower inventories.
The inventory-to-sales ratio increased from 1.56 in February to 1.58 in March. The inventory-to-sales ratio remained well