DAILY NEWS Jan 21, 2014 10:27 AM - 0 comments

Machinery, equipment and supplies subsector saw drop in wholesale sales in November

Sales were up in four provinces, with Ontario recording the largest increase and Alberta recording the largest decrease.

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Ottawa – Wholesale sales were unchanged in November 2013 at $50.4 billion, according to Statistics Canada. Lower sales in five subsectors, representing 63% of wholesale sales, were offset by higher sales in the motor vehicle and parts subsector and the food, beverage and tobacco subsector.

Excluding the motor vehicle and parts subsector, wholesale sales declined 0.5%.

In volume terms, wholesale sales were down 0.1%.

Growth in motor vehicles and food offset declines in other subsectors

The motor vehicle and parts subsector rose 2.5%, the largest change in dollar terms this November and its fourth increase in five months. Higher sales in the motor vehicle industry (+2.9%) accounted for most of the gain, reflecting the strength of exports, imports and manufacturing sales.

Sales rose 1.2% in the food, beverage and tobacco products subsector, largely because of increases in the food products industry (+1.4%). Gains were also recorded in the beverage products industry (+2.7%).

The machinery, equipment and supplies subsector had the largest decrease in dollar terms, down 0.8% to $11.0 billion. The construction, forestry, mining, and industrial machinery, equipment and supplies industry (-8.0%) drove the subsector's decline, falling to its lowest level in four months. In contrast, the computer and communications equipment and supplies industry (+6.9%) grew for a third consecutive month to reach its highest recorded level to date.

Sales in the building material and supplies subsector (-1.2%) fell for the first time in five months, led by declines in the lumber, millwork, hardware and other building supplies industry.

The November decline in the farm product subsector (-8.7%) partially offset the gain from October.

Sales were down in the personal and household goods subsector (-0.6%) for the second time in three months, led primarily by declines in the home entertainment equipment and household appliance industry (-9.7%). This drop in sales offset most of the gain recorded for this industry in October.

Sales up in four provinces

In November, higher sales were recorded in four provinces, which together account for 57% of wholesale sales in Canada. In dollar terms, Ontario recorded the largest increase and Alberta recorded the largest decrease.

Sales in Ontario were up for a fifth consecutive month, rising 1.4% to $24.7 billion, and accounted for 49% of wholesale sales in November.

Saskatchewan (+1.7%) recorded a third consecutive sales increase.

Following four months of declines, sales in New Brunswick rose 0.9%.

Sales in Alberta fell 2.4% in November, but did not offset the gain recorded in October. The machinery, equipment and supplies subsector contributed to the decline.

Sales in Quebec (-1.0%) and British Columbia (-1.3%) were also down in November. This was the second decline in three months for both provinces.

Sales in Newfoundland and Labrador fell 11.6%, more than offsetting the October gain, and pushed monthly sales to their lowest level since February 2011. Lower sales in the machinery, equipment and supplies subsector contributed to the decline.

Sales in Prince Edward Island (-1.7%) also declined in November, the first decrease in six months.

Inventory levels decrease in November

Inventories decreased 0.3% to $61.5 billion in November, with four of the seven subsectors, accounting for almost 70% of wholesale inventories, recording declines.

The largest decrease in dollar terms was in the building material and supplies subsector (-0.9%), its third decline in four months.

Inventories in the food, beverage and tobacco subsector (-1.4%) also declined in November following two monthly gains.

The machinery, equipment and supplies subsector (-0.4%) and the motor vehicle and parts subsector (-0.6%) both decreased for the fourth time in five months.

The largest increase in dollar terms occurred in the miscellaneous subsector (+0.8%), its third consecutive monthly gain.

The inventory-to-sales ratio remained at 1.22 in November.

The inventory-to-sales ratio is a measure of the time in months required to exhaust inventories if sales were to remain at their current level.

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