The 2020 Mid-Year Economic Update_long

Canada Distributor Sales Grew Slightly in 2Q

Canadian distributor sales fell for a second time in three months (-0.6 percent) in June, pulled down by lower sales in the automotive sector. Wholesalers sold $41.5 billion worth of goods and services.

Sales contracted in three of the seven sectors in June, accounting for approximately 49 percent of total sales. Decreases were registered in the automotive sector (-2.1 percent), the “other products” category (-2.3 percent) and the food, beverages and tobacco products sector (-0.8 percent). The sectors showing the largest gains were building materials (+0.6 percent) and farm products (+4.7 percent).

In constant dollars, wholesale sales declined 0.6 percent in June.

Sales for the quarter ending in June showed a lower growth rate than in the previous two quarters. In the second quarter, sales grew only 0.5 percent compared to increases of 2.9 percent and 2.5 percent in the previous two quarters. Substantial declines in sales of lumber (-8.1 percent), motor vehicles (-2.2 percent) and office and professional equipment (-3.0 percent) explain in part the low growth in the second quarter. These three groups all recorded strong growth in the first quarter.

Wholesalers in the automotive sector were unable to hold onto all the gains made in May (+2.7 percent), with sales falling 2.1 percent to $8.2 billion in June, the fourth decline in five months. Wholesale sales of motor vehicles fell 1.5 percent in June, a fourth decline in five months.

After rising 1.2 percent in May, sales of building materials advanced 0.6 percent in June. Two groups in this sector are responsible for the increase. Sales of metal products (+4.3 percent) posted a fourth consecutive increase in June.

Wholesale sales in the building materials group edged up 0.2 percent in June. This group has experienced a period of practically uninterrupted growth since the fall of 2003, as a result of the strong performance of the renovation and construction market in Canada.

Sales among lumber and millwork (-2.6 percent) wholesalers fell for the fourth time in five months. This downward movement is largely related to declining activity in the residential construction sector in the U.S. Canadian wholesalers are responsible for nearly 30 percent of lumber exports.

Check MDM’s Databank regularly for data you can use, all in one place. The information in this report was taken from Statistics Canada.

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