MRO Magazine

Manufacturing in Canada grows for four months straight

Ottawa, ON -- Current-dollar manufacturing sales continued their broadly-based advance in July 2008, rising 2.7% to...


September 17, 2008
By MRO Magazine


Ottawa, ON — Current-dollar manufacturing sales continued their broadly-based advance in July 2008, rising 2.7% to $54.1 billion, a fourth consecutive monthly increase, reports Statistics Canada in its latest Monthly Survey of Manufacturing. Manufacturers last reported four consecutive months of growth in the first half of 2002.

Overall, 17 out of the 21 manufacturing industries increased compared with June, accounting for over 97% of total sales.

Most of the sales gains in July were due to higher volumes, in contrast to the price-induced increases observed in recent months. In 2002 constant dollar prices, July sales increased 2.0% to $48.2 billion, the highest level since November 2007.

Durable goods industries reported sales increases of 4.0% and accounted for about three-quarters of the gains in manufacturing sales for July.


Primary metal sales were the principal force behind the manufacturing sales advance in July, posting their strongest monthly increase since September 2003. Sales rose 10.1% to $5.5 billion in July, following a 7.7% gain in June. International demand helped to push sales higher, as exports of metals and alloys increased 5.4% in July to a new high of $3.6 billion.

The transportation equipment industry continued to recover with a 2.3% gain in July. Motor vehicle manufacturers’ sales increased 3.1% to $4.3 billion, and motor vehicle part sales were up 2.0%. However, in the motor vehicle industry, sales remained well below the $5.0 billion monthly average in 2007.

Machinery manufacturers reported a 4.0% increase in sales, largely due to higher sales of agricultural, construction and mining equipment.


In July, six provinces posted increased manufacturing sales. There was some weakness on the East and West Coasts, while sales in Central Canada and the Prairie provinces improved compared with June.

Manitoba posted the largest percentage gain amongst the provinces, increasing by 6.2% in July. Machinery manufacturers provided much of the strength, with a notable 18.8% sales gain during the month. Manufacturers in the transportation and food industries also fared well compared with June.

Ontario manufacturers reported their sixth increase in seven months as 15 of 21 industries were up. Manufacturing sales in the province rose 4.7% in July to $25.0 billion, the highest level since April 2007.

Primary metal products sales in Ontario advanced a record 19.6% in July, as a number of iron and steel plants maintained or increased production during a month that is more frequently known for summer slowdowns.

In addition, Ontario’s transportation equipment industry continued to recover from the large decreases reported at the end of 2007, gaining 5.0% in July.

Quebec manufacturers posted a 2.0% sales gain in July, the eighth increase in the last 10 months. Primary metal manufacturers in Quebec played a major role in the province’s strength in July, with sales up 8.1% compared with June. Other areas of strength included plastic and rubber products (+14.7%) and computer and electronic products (+12.2%).
British Columbia was the only province in July to report back-to-back monthly sales declines. Manufacturing sales in the province dipped 1.2% on weakness in the wood industry and a drop by fabricated metal product manufacturers. Primary metal manufacturers in the province also bucked the national trend, with sales down 8.0%.

Most of the Atlantic provinces reported decreased manufacturing sales in July, with only Nova Scotia posting a monthly gain.


Inventory levels stabilized in July, edging up 0.2% to $67.2 billion. As a result of the strong increase in sales, the inventory-to-sales ratio dropped to 1.24, the lowest level since January 1995. The inventory-to-sales ratio is a measure of the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.

Unfilled orders decreased 0.4% in July to $63.8 billion, after two months of strong increases. Unfilled orders have been trending steadily upward since the beginning of 2005, and provide an indication of future sales.

New orders remained unchanged in July at $53.8 billion.