Canadian industries operated at 79 percent of their production capacity in the first quarter, up 2.2 percentage points from 76.8 percent in the previous quarter. This advance gave new momentum to the growth in capacity use after four consecutive quarters of progressively slowing increases.

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This was the seventh consecutive quarterly increase and the largest since the fourth quarter of 2009.

Manufacturing industries led the widespread growth in capacity use in the first quarter. Non-manufacturing industries also recorded significant increases.

Capacity use in manufacturing gained speed during the first quarter, rising 2.8 percentage points to 79.7 percent. This increase was the fastest in the current unbroken string of gains that began in the third quarter of 2009.

Capacity use rose in 18 of the 21 major manufacturing industries in the first quarter. Industries that contributed most to the increase were transportation equipment, machinery, chemicals, wood and fabricated metals. Textile mills, rubber, and electrical equipment and appliance manufacturers registered the largest increments in their respective capacity use. However, the contribution of these industries to the overall manufacturing sector was limited as a result of their smaller size.

Leather and allied products was the only industry that recorded a substantial decline in capacity use.

Strong demand for motor vehicles and motor vehicle parts helped the transportation equipment industry increase its capacity use by 3.7 percentage points to 83.8 percent in the first quarter, the highest rate since the third quarter of 2007.

Capacity use in machinery manufacturing climbed 5.5 percentage points from the previous quarter to 83.8 percent. This growth was a result of increased production of all types of machinery, notably mining, oil and gas and industrial machinery. Both shipments and inventories increased in the machinery manufacturing industry.

In the chemical industry, capacity use rose from 73.9 percent to 77.5 percent, as a result of higher production fuelled by stronger exports. Strong growth in the production of resin, synthetic rubber, and artificial and synthetic fibres and filaments more than offset a decline in pharmaceutical and medicine production.

In the wood product industry, higher production for all types of wood products pushed capacity use from 68.5 percent to 72.2 percent.

Capacity utilization increased in the first quarter in all non-manufacturing industries. In the construction industry, capacity use increased 1.1 percentage points to 76.0 percent. Higher activity levels in residential and engineering construction were behind this gain.

Larger crude petroleum export volumes enabled the oil and gas extraction industry to boost the use of its productive capacity by 2.1 percentage points to 85.7 percent.

Capacity utilization in mining, excluding oil and gas extraction, increased 2.6 percentage points to 71.2 percent, after declines in the two previous quarters. Increased activity, primarily in potash mining, but also in copper, nickel, lead, zinc and iron ore mining, accounted for this change.

Following a decline in the previous quarter, capacity use in the forestry and logging industry rose 5.1 percentage points to 96.5 percent in the first quarter as production increased.

In the electric power generation, transmission and distribution industry, capacity use increased 0.9 percentage points to 77.4 percent.