MRO Magazine

Wholesale sales rose in June for third month

Ottawa, ON -- Wholesale sales rose for the first time in nine months in June 2009 according to Statistics Cana...


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August 21, 2009
By MRO Magazine

Ottawa, ON — Wholesale sales rose for the first time in nine months in June 2009 according to Statistics Canada, mainly due to increases in the automotive products and food, beverages and tobacco products sectors. Sales in current dollars rose 0.6% to $40.4 billion.

 

In volume terms, wholesale sales increased 1.0% in June; this was the third consecutive monthly increase.

 

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In current dollars, three of the seven sectors accounting for just over half of total wholesale sales, advanced.

 

Sales in the automotive products sector increased 3.3% to $5.8 billion in June. This was the fifth straight increase since the sharp drop in January. Despite this improvement, sales in the sector remained well below the peak in July 2008.

 

The food, beverages and tobacco products sector rose 1.8% in June. This was due mainly to higher sales in the food products trade group (+1.5%), which account for about 90% of sales in the sector.

 

In contrast, the “other products” sector, consisting primarily of agricultural fertilizers and supplies, chemicals, recycled materials and paper products, posted its fifth straight decline, which partially offset the increases in the automotive products and food, beverages and tobacco products sectors.

 

Sales of the “other products” sector fell 2.2% to $4.8 billion in June, mainly due to lower sales by agricultural chemical and other farm supplies wholesalers.

 

Growth in the automotive products sector boosted Ontario, with sales rising 1.7% to $19.9 billion in June. This was the fourth monthly increase in sales in five months for the province, which accounts for about three-quarters of all sales in the automotive products sector.

 

In British Columbia, sales improved for the third month in a row (+2.9%), due mainly to strong sales in the automotive products and personal and household goods sectors.

 

Wholesale sales shrank in Quebec (-2.1%) for the 10th straight month. The decline in June reflected a slowdown in certain sectors, notably “other products” and machinery and electronic equipment.

 

Fourth straight decline in inventories

 

Wholesale inventories fell (-1.1%) for the fourth month in a row to $56.5 billion in June.

 

Overall, eight of the 15 wholesale trade groups reported lower inventory levels. The largest declines in dollar terms were in the motor vehicles (-5.7%), metal products (-5.0%), and “other products” (-1.5%) groups. These decreases were partly offset by a slight increase in inventories of building supplies (+1.5%) and motor vehicle parts and accessories (+0.7%).

 

The decline in inventories, combined with the increase in sales, translated into a decrease in the inventory-to-sales ratio from 1.42 in May to 1.40 in June.

 

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.

 

Wholesale trade data for July will be released on Sept. 18, 2009.

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