Machinery and equipment wholesale sales back on track, reports StatsCan
Ottawa, ON - In August 2010, Statistics Canada reports that wholesale sales posted their largest increase sinc...
Ottawa, ON – In August 2010, Statistics Canada reports that wholesale sales posted their largest increase since January 2010, rising 1.2% to $44.5 billion. Higher sales in the machinery, equipment and supplies subsector were a major contributor to this growth.
In volume terms, wholesale sales were up 0.9% in August.
Increases were reported in all subsectors, except for the food, beverages, and tobacco products subsector.
The largest increase in dollar terms came in the machinery, equipment and supplies sub-sector, which climbed 3.2% to $9.4 billion in August. This was the subsector’s highest level since December 2008. All four component industries that comprise this subsector increased, with the construction, forestry, mining, and industrial machinery, equipment and supplies industry (+4.7%) reporting the largest gain.
The miscellaneous subsector, which includes agricultural supplies, non-agricultural chemicals, paper products, and recycled materials industries, rose 3.4% in August, up for a third consecutive month. This gain was largely attributable to increases in the other miscellaneous (+5.9%), and the agricultural supplies (+3.4%) industries.
The food, beverages and tobacco products subsector (-0.9%) posted the lone decline for the month. The food product industry, which makes up close to 90% of the subsector, decreased 1.1% in August following a 2.0% increase in July.
WHOLESALE SALES UP IN MOST PROVINCES
Wholesale sales were up in seven provinces in August, with Ontario and Alberta posting the largest increases in dollar terms.
The largest contributor to the increase was Ontario, where sales rose 1.5% in August following a 0.3% decline in July. This was the province’s strongest month-over-month gain since November 2009.
In Alberta, wholesale sales grew by 2.2%, helped by higher sales in the machinery, equipment and supplies subsector. This was the province’s ninth increase in 10 months.
Sales in Manitoba rose 3.8% in August, increasing for the third consecutive month. Higher sales in the miscellaneous subsector contributed to this growth.
Wholesale sales in Quebec remained unchanged following a 1.0% decline in July.
INVENTORIES DECLINE FOR THE FIRST TIME IN FIVE MONTHS
Wholesale trade inventories fell 0.3% to $52.9 billion in August, their first decrease in five months.
Overall, 11 of the 25 wholesale trade industries reported lower inventory levels.
Wholesalers of motor vehicles, metal service centres, and the textile, clothing and footwear industries reported the biggest inventory decreases in dollar terms.
The largest inventory increases in dollar terms came in the construction, forestry, mining, and industrial machinery, equipment and supplies, and the other miscellaneous industries.
The decline in inventories, combined with the increase in sales, translated into a decrease in the inventory-to-sales ratio from 1.21 in July to 1.19 in August.
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 September will be released by Statistics Canada on November 18, 2010.