Manufacturing sales in February declined most in Ontario while Quebec numbers rose
Ottawa, ON -- Manufacturing sales edged down 0.3% to $49.1 billion in February 2012, following a 1.3% decrease in January 2012. Lower sales were recorded for the motor vehicle assembly, food and motor vehicle parts industries....
Ottawa, ON — Manufacturing sales edged down 0.3% to $49.1 billion in February 2012, following a 1.3% decrease in January 2012. Lower sales were recorded for the motor vehicle assembly, food and motor vehicle parts industries. These declines were mostly offset by increases in the aerospace product and parts, non-metallic mineral products, and petroleum and coal products industries.
Sales decreased in 11 of 21 industries, representing about 64% of Canadian manufacturing. Sales of durable goods rose 0.2% while those of non-durable goods declined 0.8%.
Constant dollar sales fell 0.1% in February, indicating a decrease in the volume of manufactured goods.
Sales down in the motor vehicle and parts industries
Motor vehicle assembly sales were down 8.7%, the first decline since June 2011. Similarly, motor vehicle parts sales were down 7.2%, the first decrease since August.
Food manufacturers posted the second-largest decline in sales in dollar terms, down 3.1% to $6.9 billion. This was the largest decrease in the industry since June 2010 and partly reflected declines in the grain and oilseed milling industry, and the seafood product preparation and packaging industry.
In the chemical industry, sales declined 2.5% to $4.0 billion. The decrease reflected lower volumes reported by a large number of manufacturers.
These declines were largely offset by increases in the aerospace product and parts, non-metallic mineral product, and petroleum and coal products industries.
In the aerospace product and parts industry, production advanced 32.1% to $1.2 billion in February, following a 32.7% drop in January.
Non-metallic mineral product sales were up 22.9% to $1.2 billion. Some manufacturers indicated that favourable weather conditions stimulated sales related to construction activity.
Petroleum and coal products manufacturers reported a 3.0% increase in sales. The increase partly reflects a 1.7% rise in prices in the industry.
Sales declines centred in Ontario
The vast majority of the sales declines were in Ontario, where manufacturers reported a 2.7% decrease to $22.0 billion, following a decrease of 1.0% in January. Sales decreased in 13 of 21 industries, representing more than three-quarters of the province’s manufacturing. In particular, motor vehicle assembly sales fell 9.1% while motor vehicle parts sales were down 7.3%. A 5.0% decline in the food industry also contributed to the decrease.
In contrast, manufacturing sales advanced 2.7% to $11.9 billion in Quebec. The increase reflected higher sales in the petroleum and coal products and machinery industries. An increase in production in the aerospace product and parts industry also contributed to the provincial gain.
Sales in Alberta were up 1.8% to $6.5 billion. A 6.5% gain in petroleum and coal products sales was largely responsible for the increase.
Inventory levels rise
Inventories rose 0.3% in February to $65.8 billion, the 16th gain in 17 months. Inventories were up in 10 of 21 industries.
Inventory levels in the computer and electronic products industry advanced 5.0% to $3.4 billion. Higher inventories of raw materials were responsible for most of the gain.
In the machinery industry, inventories rose 1.4% to $6.9 billion. Manufacturers reported higher inventories for all three stages of fabrication: raw materials, goods in process and finished products inventories.
Petroleum and coal products inventories advanced 1.7% to $4.9 billion. A number of refineries increased the value of finished products on hand in February.
Most of these gains were offset by declines in the fabricated metal product (-1.0%), other transportation equipment (-11.9%) and motor vehicle assembly (-4.2%) industries.
The inventory-to-sales ratio advanced to 1.34 in February from 1.33 in January. 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 increase
Unfilled orders rose 1.9% to $61.6 billion in February, the first increase since November 2011. Despite the gain in February, unfilled orders have been relatively flat since September 2011.
A 3.0% advance in the aerospace product and parts industry was mostly responsible for the increase. Excluding this industry, unfilled orders were up 0.9%.
In the machinery industry, unfilled orders rose 7.6% to $8.0 billion. The gain was concentrated in the engine, turbine and power equipment manufacturing industry.
New orders increased 2.5% to $50.3 billion in February, the seventh gain in nine months. The gain largely stemmed from increases in the aerospace product and parts, and machinery industries.