MRO Magazine

Machinery and equipment contributes to decline in wholesale services prices

Ottawa – The Wholesale Services Price Index (WSPI) declined 0.5% in the second quarter of 2013, Statistics Canada reports. Of the eight major wholesale sectors, margins fell in five and rose in three.


Industry

November 26, 2013
By MRO Magazine


Industries

Ottawa – The Wholesale Services Price Index (WSPI) declined 0.5% in the second quarter of 2013, Statistics Canada reports. Of the eight major wholesale sectors, margins fell in five and rose in three.

The decline of the WSPI in the second quarter was led by lower margins by wholesalers of petroleum products (-5.8%). Machinery, equipment and supplies wholesalers (-1.6%) and personal and household goods wholesalers (-0.7%) also contributed to the decline of the WSPI in the second quarter. The decrease in margins by wholesalers of petroleum products was primarily a result of lower prices for diesel fuel (-7.6%) and furnace oil (-11.5%).

The other sectors that registered declines were miscellaneous wholesalers (-0.6%) and food, beverage and tobacco wholesalers (-0.2%).

Wholesalers of farm products (+5.1%) posted the largest margin advance in the second quarter, followed by wholesalers of motor vehicles and parts (+1.7%) and building material and supplies (+1.1%) wholesalers.

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Year over year the WSPI fell 1.6%. This was the largest year-over-year decline since the fourth quarter of 2009. Declining margins were recorded in all but one of the wholesale sectors.

Margins for wholesalers of farm products (-6.8%) recorded the largest year-over-year decline, followed by wholesalers of miscellaneous products (-3.8%), machinery, equipment and supplies (-2.7%) as well as wholesalers of personal and household products (-2.0%). Year over year, the Canadian dollar depreciated 1.3% against the US dollar. Variations in exchange rates can have a strong influence on the WSPI given the high composition of imported machinery and equipment in the index.

Falling year-over-year margins were also registered by food, beverage and tobacco wholesalers (-0.7%), wholesalers of motor vehicle and parts (-0.5%) and petroleum products wholesalers (-0.1%).

Wholesalers of building material and supplies (+1.7%) posted the lone year-over-year margin gain to moderate the downward movement of the WSPI. This advance was mostly a result of margin increases in all subsectors of building material and supplies.