Wholesale sales were up in Central Canada in March, increasing by 0.9% in Quebec and 0.6% in Ontario. For Quebec wholesalers, this was a sixth gain in eight months. In both provinces, the increase in March was mainly attributable to household goods and machinery and electronic equipment, two sectors that registered robust gains at the national level.
The two westernmost provinces continued to enjoy the strongest sales growth in the country. In Alberta, wholesale sales increased for an eighth consecutive month on the strength of numerous sectors, notably machinery and electronic equipment and automotive products. British Columbia wholesalers recorded their fourth increase in five months, which was mainly attributable to the machinery and electronic equipment sector as well as the building materials sector.
First decline in wholesalers’ inventories in four months
Inventories declined 0.3% in March following three consecutive monthly increases. The decrease in inventories was general in March, with 11 of the 15 trade groups registering a decline. Despite March’s drop, the trend in total inventories has generally been upward since November 2003.
The strong increase in sales, combined with a decrease in inventories, caused the inventory-to-sales ratio to fall to 1.20, down from 1.22 in February. The inventory-to-sales ratio is still relatively low on a historical basis. This ratio has generally been stable since October 2004, following a downward period that began in October 2003.
Source: Statistics Canada Release
Wholesale sales rose 0.8% to $41.4 billion in March after falling 1.0% in February. Although five of the seven wholesale sectors posted gains, most of March’s increase was attributable to stronger sales of personal and household goods (+3.6%) and of machinery and electronic equipment (+3.3%).
Conversely, the automotive products sector was down sharply (-3.0%). Excluding the automotive products sector, wholesale sales rose 1.8% in March after declining 0.7% the previous month.
Since September 2003, total wholesale sales have generally been rising, with strength in most trade groups. Previously, slumping motor vehicle sales were the main cause of a decline that began in March 2003.
In constant prices, wholesale sales rose 0.2% in March.
During the first three months of 2006, the value of wholesale sales was 2.4% higher compared with the previous quarter. This increase was attributable in part to the strong showing of the automotive products sector, which posted a quarterly growth rate of 5.4%. The machinery and electronic equipment (+5.0%) sector and the building materials (+3.6%) sector also registered solid gains.
Productive month for personal and household goods wholesalers
After falling 3.4% in February, sales of the personal and household goods sector rose 3.6% in March. The increase was entirely attributable to rebounding sales of household and personal products (+8.3%). Although sales of household goods had been relatively lacklustre over the previous two months, sales have risen steadily since mid-2003, partly owing to the booming real estate market.
Machinery and equipment wholesalers maintain their momentum
For a fourth consecutive month, the machinery and electronic equipment sector registered a gain (+3.3%), with strength in all groups in the sector.
Wholesalers of computers and electronic equipment (+3.5%) and office and professional equipment (+4.0%) benefited from increased investment in March. For wholesalers of computers and electronic equipment, this was only the third increase in nine months. By contrast, wholesalers of office and professional equipment, who registered their fourth consecutive monthly gain, have generally posted rising sales since October 2003.
Wholesalers in the machinery and equipment group posted a 2.8% increase in March. This group has experienced almost continual growth since March 2004. The rise in prices of raw materials has prompted increased investment, which has greatly contributed to the growth of this group. According to the survey of private and public investment intentions for 2006, investment in equipment should remain robust in 2006, considering the excellent prospects in the energy and utilities sectors. Among wholesalers in general, the machinery and equipment group ranks fourth in sales and first in inventories.
Second consecutive decrease for automotive products
After falling 2.6% in February, motor vehicle wholesalers saw sales slip another 3.6% in March. In the past two months, wholesalers in this group have felt the effects of declining vehicle exports. Approximately one-quarter of the sales of this trade group are destined for foreign markets. During the last half of 2005, sales in this group went through a period of robust growth led by exports.
For a fifth time in seven months, wholesale sales of motor vehicle parts declined (-0.4%). Wholesalers in this industry, who do not supply auto plants but sell mainly to retailers and dealers, have posted generally stable sales since July 2004.
Central Canada and six other provinces and territories post