Source: Statistics Canada
The value and volume of wholesale trade in Canada rose in May, due in large part to higher global demand for agricultural chemical products.
Current dollar wholesale trade rose 1.6% to $44.2 billion in May, the fourth gain in the last five months. When removing the effect of price changes, sales in constant dollars increased by 0.7% in May.
Overall, six of seven wholesale sectors reported higher sales values, with the only decline coming from the automotive sector. Both motor vehicles and motor vehicle parts and accessories fell.
Since February 2008, the trend in current dollar wholesale trade has been slightly upwards. This follows a period, from July 2007 to February 2008, where sales had been trending gradually down, largely as a result of a slowdown in exports of motor vehicles and lumber.
The other products” sector, which consists primarily of agricultural fertilizers and supplies, chemicals, recycled materials and paper products, recorded its strongest gain this year as current dollar sales rose 9.5% to $6.4 billion in May.
Sales of agricultural chemicals such as fertilizers were particularly strong, reflecting strong global demand for these products. Exports of fertilizers and fertilizer materials were 57.7% higher in May compared with the same month in 2007. In addition, based on figures from the Industrial Product Price Index, overall fertilizer prices in May were 27.5% higher than May 2007 prices.
Farm products posted their largest monthly increase in two years, as current dollar sales increased 7.3% in May to $474.6 million. This strong gain reversed all of the decreases registered in the first five months of 2008.
In Saskatchewan, sales increased for a third straight month in May, up 5.8% to $1.7 billion. Higher sales of building supplies and farm products were largely responsible for the increase.
Sales in Alberta (+4.7%) rose for a fifth consecutive month on the strength of several sectors, notably building supplies, machinery and equipment, and “other products”.
Only two provinces showed drops in May: British Columbia (-1.3%), which was affected by declines in the building materials, and the machinery and equipment sectors, and Newfoundland and Labrador (-0.4%).
Inventories rose for the third consecutive month in May, up 0.6% to $54.8 billion. Overall, 10 out of the 15 trade groups, representing 82% of inventories, reported increases in May.
The inventory-to-sales ratio declined for a second consecutive month, from 1.25 in April to 1.24 in May.