Manufacturing sales in February highest since 2008
Ottawa - Canadian manufacturing sales increased 1.4% to $51.2 billion in February 2014, Statistics Canada reports. The sales level was the highest since July 2008, the peak that was reached before the last recession began. Manufacturing sales...
Ottawa – Canadian manufacturing sales increased 1.4% to $51.2 billion in February 2014, Statistics Canada reports. The sales level was the highest since July 2008, the peak that was reached before the last recession began. Manufacturing sales have risen in eight of the past 10 months. The gain in February was largely attributable to higher sales in the transportation equipment industry and the petroleum and coal product industry.
Constant dollar sales rose 0.8%, indicating a rise in the volume of goods sold. In contrast to current dollar sales, constant dollar sales remained 8.2% below the July 2008 peak.
Sales of transportation equipment and petroleum and coal products increase
Transportation equipment sales rose 4.3% to $8.9 billion in February. The advance partly stemmed from a 6.4% increase in motor vehicle parts sales. The motor vehicle assembly and other transportation equipment industries also posted gains in February.
Sales in the petroleum and coal product industry increased 2.9% to $7.5 billion, reaching their highest level since March 2012. Most of the gain reflected a 2.5% rise in prices for the industry, as reported by the February Industrial Product Price Index.
Lower sales in the food (-0.6%), computer and electronic product, (-3.8%) and wood product (-1.5%) industries partly offset these gains. Sales declines were widespread in these industries.
Sales gains concentrated in Ontario
While seven provinces posted higher sales in February, the bulk of the gain was concentrated in Ontario.
In Ontario, sales rose 2.9% to $23.3 billion in February. About half of the provincial gain stemmed from a 4.8% advance in the transportation equipment industry. Sales rose 7.1% in the primary metal industry and 5.7% in the petroleum and coal product industry. A 5.5% decline in the computer and electronic product industry offset some of the gains.
Manufacturing sales in Newfoundland and Labrador advanced 16.2% to $592 million in February, following a 14.9% decline in January. Sales in Newfoundland and Labrador are more volatile compared with manufacturing sales in other provinces.
In Manitoba, manufacturing sales rose 6.3% to $1.3 billion, reaching the highest level since July 2012. Most of the gain reflected an increase in the transportation equipment industry.
Sales in British Columbia declined 3.0% to $3.4 billion in February. Approximately half of the provincial decline was the result of a 7.8% decrease in the wood product industry. Sales were also down in the food and machinery industries.
Unprecedented advance in unfilled orders
In February, unfilled orders posted the largest monthly increase since the current series began in 1992, advancing 16.5% to $91.6 billion. The gain was attributable to orders received by transportation equipment manufacturers. Unfilled orders for the manufacturing sector have risen substantially over the past four years. The level reached in February was 79.6% higher than the post-recession low of $51.0 billion posted in November 2009.
In the transportation equipment industry, unfilled orders jumped 23.4% to $66.6 billion, reaching the highest level on record. Orders received in the other transportation equipment sub-industry as well as the aerospace product and parts sub-industry were responsible for the gain.
New orders for the manufacturing sector rose 18.8% to $64.2 billion as a result of gains in the transportation equipment industry.
Inventories rose 1.1% to $72.3 billion in February, the sixth advance in eight months. The increase reflected higher inventory levels in the transportation equipment, wood product and fabricated metal product industries.
In the transportation equipment industry, inventories rose 1.7% to $13.1 billion. The gain mostly stemmed from higher inventories of aerospace products and parts. Other transportation equipment inventories also rose in February.
Wood product inventories increased 4.2% to $3.9 billion in February. Approximately 63% of the gain reflected higher raw materials on hand.
Inventories of fabricated metal products rose 1.6% to $4.7 billion. This was the 4th increase in 12 months.
The inventory-to-sales ratio edged down from 1.42 in January to 1.41 in February. The inventory-to-sales ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.