DAILY NEWS Feb 19, 2014 12:01 PM - 0 comments

Wholesale sales of machinery, equipment and supplies plummet 3.5% in December

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Ottawa − Wholesale sales decreased 1.4% to $49.6 billion in December 2013, the lowest level in six months. Of the seven wholesale subsectors, five, representing 79% of wholesale sales, recorded declines, reports Statistics Canada.

In volume terms, wholesale sales were down 1.6%.

The machinery, equipment and supplies subsector (-3.5%) recorded the largest decline in dollar terms in December. The computer and communications equipment and supplies industry (-13.2%) accounted for the subsector's decline, with sales in this industry falling to their lowest level since March 2013. Sales have been volatile in this subsector over the last 14 months.

The decline in the motor vehicle and parts subsector (-4.0%) in December more than offset November's gain. The motor vehicle industry (-5.6%) accounted for most of the decrease.

Sales in the personal and household goods subsector (-1.7%) fell for a second consecutive month, with declines recorded in most of the industries in the subsector.

The miscellaneous subsector declined for a seventh consecutive month, edging down 0.1%. Sales fell in all of the industries in this subsector except for agricultural supplies, which rose 3.6% in December.

The largest increase in dollar terms was recorded in the food, beverage and tobacco products subsector (+1.7%), the fifth gain in six months. The food products subsector (+1.5%) accounted for much of the gain. Higher sales were also recorded for the cigarette and tobacco product subsector (+7.9%) following three months of declines.

Sales down in four provinces

Lower sales were recorded in four provinces in December, accounting for 84% of wholesale sales. The three leading provinces in terms of size of the wholesale trade industry (Ontario, Quebec and Alberta) all registered declines.

Ontario (-1.8%) posted the largest decline in dollar terms, which more than offset the gains from the previous two months. The motor vehicle and parts subsector contributed to the decline.

Sales in Alberta (-2.5%) and Quebec (-1.2%) were down for a second consecutive month.

After three consecutive monthly gains, sales in Saskatchewan fell 5.3%. The decline was widespread across subsectors.

Higher sales were recorded in British Columbia (+1.0%), more than offsetting November's decline.

Sales rose 2.2% in Manitoba, a second consecutive increase for the province.

Inventories rise in December

Inventories rose 0.4% to $61.7 billion in December, the first increase in six months. Gains were recorded in four of seven subsectors, accounting for 59% of wholesale inventories.

The largest increase in dollar terms was in the personal and household goods subsector (+2.5%), following two consecutive monthly declines.

Inventories rose for the fourth consecutive month in the miscellaneous subsector (+1.5%).

The motor vehicle and parts subsector (-1.7%) posted a fourth consecutive decline.

The inventory-to-sales ratio rose from 1.22 in November to 1.24 in December.

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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