MRO Magazine

Machinery and equipment helped drive GDP in February

Ottawa, ON -- The Canadian economy rose by 0.3% in February 2005 after increasing by 0.2% in January, reports Stati...


May 27, 2005
By MRO Magazine

Ottawa, ON — The Canadian economy rose by 0.3% in February 2005 after increasing by 0.2% in January, reports Statistics Canada. Much of the growth in February was attributable to increased spending by consumers in retail stores and by continued strength in the demand for machinery and equipment by businesses, both domestic and abroad.

Retailing activity increased a further 1.7% in February after rising by 2.3% in January.

Wholesaling activity increased by 1.4% in February after edging down 0.2% in January. Increased foreign demand for potash, industrial chemicals, and machinery and equipment helped boost the output of wholesalers of these types of products. Wholesaling of oil products decreased in line with a reduction in crude petroleum extraction.

Industrial production (the output of factories, mines and utilities) decreased by 0.2% as an increase in manufacturing output (+0.2) was overshadowed by declines in the mining, oil and gas extraction sector (-1.3%) and by utilities (-0.8%).


A relatively warm February compared with previous months across many regions of the country and in the United States lowered the demand for electricity and natural gas. Energy sector output fell 1.0%, a second consecutive decline. In the United States, the index of industrial production rose by 0.2% with increases in the manufacturing and mining sectors tempered by reduced output by utilities.

Output in the manufacturing sector rose by 0.2% in February, pushed by durable goods production (+0.6%). Only 9 out of the 21 major groups, accounting for 38% of manufacturing’s value added, reported gains. Decreases were widespread but more concentrated in paper (-1.3%), sawmills (-1.6%), and food products (-0.6%).

The manufacturing of machinery increased by 2.4%, in part to satisfy foreign demand. There was particular strength in the production of agricultural, construction and mining machinery (+4.5%), metalworking (+5.3%) and other general purpose machinery (+4.0%).

Primary metal manufacturing increased by 2.2%, helped by the progressive resumption of output in primary production of aluminum (+4.4%) after a labour dispute curtailed production at a smelter in the third quarter of 2004. Non-ferrous metal smelting and refining (+7.8%) rebounded in February with an increase in uranium production.

Continued strong demand for heavy-duty trucks fuelled the output of motor vehicles (+0.6%) as manufacturers adjusted their production of automobiles and light-duty motor vehicles to the demand for Canadian built models.