MRO Magazine

New Brunswick saw manufacturing sales advance 15.2% in November

Ottawa, ON -- Manufacturing sales in Canada edged up 0.1% to $42.6 billion in November 2009, as gains in sever...

Ottawa, ON — Manufacturing sales in Canada edged up 0.1% to $42.6 billion in November 2009, as gains in several industries were offset by decreases in the transportation equipment industry. This was the fifth increase in manufacturing sales in six months, according to the latest Monthly Survey of Manufacturing from Statistics Canada.


Sales gains in chemical manufacturing and in petroleum and coal products were offset by declines in the aerospace product and parts and motor vehicle industries.



Constant dollar manufacturing sales decreased 0.8% in November. This was the first decrease in constant dollar sales in three months. Even with the recent advances, constant dollar manufacturing sales were 8.4% below November 2008.


Sales advanced in 12 of the 21 manufacturing industries, accounting for about 57% of total sales.


Non-durable goods industries behind most of the sales gains


Most of the sales gains for November were in non-durable goods industries, which increased 1.0% compared with October.


Sales by chemical manufacturers advanced 5.3% compared with October. About one-third of the gain was a result of rising pharmaceutical and medicine manufacturing sales.


Sales by the petroleum and coal product industry rose 2.9% in November, the third increase in four months. Sales in this industry were pushed up by higher prices, which increased 4.7% from October.


The transportation equipment industry offset most of the sales gains in November, declining 4.3%. Production in the aerospace product and parts industry pulled back 15.4% after a 48.2% jump the previous month. Motor vehicle sales were also down, decreasing 4.5% after two months of gains.


Provincial results were mixed


Half of the provinces posted increased sales in November. The largest gain was in New Brunswick, where manufacturing sales advanced 15.2% in November. This was the second monthly increase after a 26.1% drop in September.


Alberta continued to report stronger manufacturing sales in November, with rising sales in the past four months. These increases were largely attributable to petroleum and coal product sales, which reached the highest level for the province since October 2008.


Sales in Quebec advanced 0.6% in November, despite a 10.6% drop in transportation equipment sales. Petroleum and coal products (+5.2%) and primary metals (+4.9%) led the provincial gains.


Manufacturing sales in Newfoundland and Labrador fell 9.1% compared with October, mostly due to weaker sales of non-durable goods. Manitoba also reported lower sales for November, decreasing 2.9%.


Inventories edge down in November


Inventory levels declined 0.3% in November to $59.7 billion. This was the 10th decrease in 12 months, moving inventories 12.2% lower than November 2008 levels.


Inventory levels contracted in 16 of 21 industries, led by a 3.4% drop in the transportation equipment industry. Aerospace product and parts inventories were behind most of that decrease.


Non-durable goods inventories rose 1.4%, despite decreases in 7 of 11 industries. The increase was led by a 10.0% rise in petroleum and coal product inventories, partly reflecting higher prices compared with October.


The inventory-to-sales ratio declined for the fifth time in six months, edging down to 1.40. The decline in November was largely the result of lower inventory levels, pushing the ratio to its lowest level since October 2008 (1.34).


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 decline


Unfilled orders declined in November for a fifth consecutive month, down 1.4% to $51.5 billion. This marked the lowest level since March 2007.


The decrease in the backlog of orders was led by machinery (-3.0%) due to a major plant closure at the end of October. Aerospace product and parts (-2.6%) also contributed to the decline.


Excluding the aerospace industry, unfilled orders edged down 0.2% in November.


New orders increased by 3.2% in November to $41.9 billion, reversing a 2.2% drop in October. This was the third gain in four months.


Data from the December 2009 Monthly Survey of Manufacturing will be released by Statistics Canada on Feb. 16, 2010.