March manufacturing sales total $51B
Manufacturing sales rose 2.9% to $51.0 billion in March, the second increase in six months, according to Statistics Canada's Monthly Survey of Manufacturing. An increase in the production of aerospace products and parts coupled with gains in the motor vehicle industry generated higher sales for the month.
Partially offsetting the advance was a drop in sales of fabricated metal products. The increase in March followed a 2.2% decrease in February, which was revised to reflect updated information provided by respondents.
Sales rose in 10 of 21 industries, representing approximately 60% of all Canadian manufacturing. Constant dollar sales rose 2.9%, indicating that the volume of goods sold also increased in March.
Production in the aerospace industry rose 42.3% in March after falling 29.4% in February. As is typical for this industry, fluctuations in the value of the Canadian dollar had an impact on the production, which is measured in Canadian currency.
The depreciation of the Canadian dollar in March caused the value of sales and inventories held in US dollars to increase. Production in the first quarter of 2015 fell 3.9% from the fourth quarter of 2014, marking the second consecutive quarterly decline. However, aerospace production was 6.3% higher in the first quarter of 2015 than in the first quarter of 2014.
Sales in the motor vehicle industry grew 12.8% in March, after declining 18.9% in the previous two months. The declines in the first two months of 2015 reflected shutdowns for retooling at various plants in Ontario. The growth in March reflected higher production as this work started to wind down.
Sales of food rose 3.0% in March to their highest level on record, reflecting widespread gains in the industry.
Partially offsetting those increases was a 3.6% decline in sales of fabricated metal products.
Sales rose in five provinces with the largest gains occurring in Quebec and Ontario.
Sales in Quebec rose 6.9% to $12.4 billion in March, their highest value since October 2014. The monthly sales gain in March was the second in six months for the province. The higher sales reflected widespread increases in the aerospace and primary metals industries.
Ontario sales rose 2.6% in March, driven by increased sales of motor vehicles, as factories undergoing retooling began to come back online. In addition, food and motor vehicle parts manufacturers reported higher sales. The gain in total provincial sales followed two monthly declines.
Partially offsetting the gains was a 2.2% decrease in sales in British Columbia, which reflected lower sales of non-durable goods. It was the province’s second sales decline in three months.
Inventories held by manufacturers fell 0.4% in March, the second decline in six months. The lower inventories reflected decreases in the chemical, fabricated metal product and aerospace product and parts industries.
The largest increase in inventories occurred in the petroleum and coal product industry, where inventories rose 1.3% as a result of higher volumes.
The inventory-to-sales ratio fell from 1.45 in February to 1.41 in March. 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.
Unfilled orders were down 0.2% in March, reflecting lower orders in the machinery, computer and electronic product, and fabricated metal product industries. These declines were partially offset by increases in the transportation equipment industry.
New orders rose 5.1%, reflecting higher unfilled orders in the transportation equipment industry.