Monthly Survey of Manufacturing, September 2019
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Released: 2019-11-19
Manufacturing sales edged down 0.2% in September to $57.4 billion, following a 0.8% increase in August.
Chart 1
Manufacturing sales
Sales were down in 10 of 21 industries, representing 62.2% of the Canadian manufacturing sector. Sales in the petroleum and coal product and the motor vehicle parts industries accounted for the majority of the decrease in September. However, these decreases were largely offset by increases in the machinery and motor vehicle industries.
Constant dollar sales decreased 0.7%, indicating that a lower volume of products was sold in September.
Manufacturing sales declined 1.3% to $172.0 billion in the third quarter. In volume terms, manufacturing sales fell 1.0% in the third quarter, mostly due to lower volumes sold in the petroleum and coal product (-2.4%), food (-1.5%) and chemical (-1.9%) industries.
Lower volumes at refineries
Sales in the petroleum and coal product industry were down for the fourth straight month, falling 1.9% to $5.9 billion in September. This decrease reflected lower sales volumes, as prices for the industry rose 0.3% according to the Industrial Product Price Index. Partial shutdowns at a number of Canadian refineries for maintenance work during the month were a major contributor to the decline in volumes sold (-2.4%).
Sales of motor vehicle parts fell 4.3% to $2.6 billion. Some parts plants in Canada were impacted by the United Auto Workers strike in the United States and had to scale back or stop production towards the end of the September.
Food manufacturing was down 1.0% to $8.7 billion, primarily from lower sales of meat products. In constant dollar terms, sales decreased 0.5% in the food industry.
Other industries that posted a decline were aerospace product and parts (-3.7%), electrical equipment, appliance and component (-6.8%) and chemicals (-1.4%).
Sales in the machinery industry increased 5.5% to $3.7 billion. This was the largest monthly increase since May 2018. The gains in the machinery industry were widespread but more pronounced in the commercial and service machinery industry and the metalworking machinery industry. Some respondents indicated that they had completed large projects that had been in progress for months. Constant dollar sales in the machinery industry were up 5.4%.
Motor vehicle sales increased 2.9% to $5.5 billion in September, following a 3.1% gain in August. Sales typically fall in September but longer summer shutdowns that extended into August led to a gain in September. In constant dollars, sales volumes in the motor vehicle industry rose 2.7%.
Sales decrease in seven provinces
Sales were down in seven provinces in September, led by Alberta. British Colombia reported the largest increase.
In Alberta, sales decreased 3.2% to $6.1 billion. Sales were down in 14 of 21 industries, led by petroleum and coal products (-9.5%). Shutdowns at major refineries contributed to the decline.
Sales were down in Manitoba (-4.0%), Quebec (-0.5%) and Saskatchewan (-4.6%), mainly due to lower sales in non-durable goods.
The largest monthly increases in sales in dollars terms were in British Columbia (+3.7%) and New Brunswick (+9.9%). Both provinces registered higher sales in non-durable goods, and to a lesser extent, durable goods.
Manufacturing sales in census metropolitan areas
Manufacturing sales on an unadjusted basis fell in 5 of 12 census metropolitan areas in September, led by Edmonton (-7.3%) and Toronto (-1.2%).
In Edmonton, lower sales of petroleum and coal products were behind the decline in September.
Manufacturing sales in Toronto were down 1.2% to $10.5 billion, mainly due to lower sales of motor vehicles (-3.7%) and motor vehicle parts (-5.0%) and partly offset by higher sales in the machinery industry.
In Montréal, higher sales of transportation equipment and machinery drove the growth (+3.0%) in September.
Vancouver's manufacturing sector was up 5.7% to $2.4 billion in September.
Inventory levels decrease
Inventory levels declined 0.8% to $88.0 billion in September, following two months of increases. Inventories were down in 11 of 21 industries, led by transportation equipment (-3.0%), petroleum and coal product (-4.3%) and wood product (-1.9%) industries. These decreases were partly offset by a 1.3% increase in food inventories.
Chart 2
Inventory levels decrease
The inventory-to-sales ratio decreased from 1.54 in August to 1.53 in September, mostly due to lower inventories of durable goods. This ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.
Chart 3
The inventory-to-sales ratio declines
Unfilled orders decline
Unfilled orders decreased 0.6% to $97.4 billion in September. The decline was mainly attributable to lower unfilled orders in the aerospace product and parts industry as well as the computer and electronic products industry.
Chart 4
Unfilled orders decrease
These declines in unfilled orders were partially offset by an increase in unfilled orders in the machinery industry.
New orders fell 2.7% to $56.8 billion in September, following a 6.6% gain in the previous month. This decrease was mostly due to lower new orders in the aerospace product and parts industry, as well as in the ship and boat building industry.
Capacity utilization rate decreases
The unadjusted capacity utilization rate for the manufacturing sector declined 0.5 percentage points, from 79.7% in August to 79.2% in September.
Chart 5
The capacity utilization rate decreases
Overall, the capacity utilization rate decreased in 10 of 21 industries, with the petroleum and coal products and chemical industries posting the largest declines in September.
The capacity utilization rate of the petroleum and coal product industry declined for a second consecutive month, falling 4.3 percentage points to 82.4% in September. The decrease was attributable to lower production due to shut downs for maintenance at some refineries.
The capacity utilization rate for the chemical industry decreased 2.9 percentage points to 75.5% in September. The decline was primarily due to the lower capacity utilization rate in the pesticide, fertilizer and other agricultural chemical manufacturing industry.
Following three consecutive monthly declines, the capacity utilization rate for the computer and electronic product industry increased 5.3 percentage points to 84.9% in September. The increase was mostly attributable to higher production in the communication equipment industry, as well as in the semiconductor and other electronic component manufacturing industry.
Sustainable Development Goals
On January 1, 2016, the world officially began implementation of the 2030 Agenda for Sustainable Development—the United Nations' transformative plan of action that addresses urgent global challenges over the next 15 years. The plan is based on 17 specific sustainable development goals.
The Monthly Survey of Manufacturing is an example of how Statistics Canada supports the reporting on the Global Goals for Sustainable Development. This release will be used in helping to measure the following goal:
Note to readers
Monthly data in this release are seasonally adjusted and are expressed in current dollars unless otherwise specified.
For information on seasonal adjustment, see Seasonally adjusted data – Frequently asked questions. For information on trend-cycle data, see Trend-cycle estimates – Frequently asked questions.
Non-durable goods industries include food, beverage and tobacco products, textile mills, textile product mills, clothing, leather and allied products, paper, printing and related support activities, petroleum and coal products, chemicals, and plastics and rubber products.
Durable goods industries include wood products, non-metallic mineral products, primary metals, fabricated metal products, machinery, computer and electronic products, electrical equipment, appliances and components, transportation equipment, furniture and related products, and miscellaneous manufacturing.
Production-based industries
For the aerospace and shipbuilding industries, the value of production is used instead of the value of sales of goods manufactured. The value of production is calculated by adjusting monthly sales of goods manufactured by the monthly change in inventories of goods in process and finished products manufactured. The value of production is used because of the extended period of time that it normally takes to manufacture products in these industries.
Unfilled orders are a stock of orders that will contribute to future sales assuming that the orders are not cancelled.
New orders are those received, whether sold in the current month or not. New orders are measured as the sum of sales for the current month plus the change in unfilled orders from the previous month to the current month.
Manufacturers reporting sales, inventories and unfilled orders in US dollars
Some Canadian manufacturers report sales, inventories and unfilled orders in US dollars. These data are then converted to Canadian dollars as part of the data production cycle.
For sales, based on the assumption that they occur throughout the month, the average exchange rate for the reference month established by the Bank of Canada is used for the conversion. The monthly average exchange rate is available in table 33-10-0163-01. Inventories and unfilled orders are reported at the end of the reference period. For most respondents, the daily average exchange rate on the last working day of the month is used for the conversion of these variables.
However, some manufacturers choose to report their data as of a day other than the last day of the month. In these instances, the daily average exchange rate on the day selected by the respondent is used. Note that because of exchange rate fluctuations, the daily average exchange rate on the day selected by the respondent can differ from both the exchange rate on the last working day of the month and the monthly average exchange rate. Daily average exchange rate data are available in table 33-10-0036-01.
Revision policy
Each month, the Monthly Survey of Manufacturing releases preliminary data for the reference month and revised data for the three previous months. Revisions are made to reflect new information provided by respondents and updates to administrative data.
Once a year, a revision project is undertaken to revise multiple years of data.
Real-time data tables
Real-time data tables 16-10-0118-01, 16-10-0119-01, 16-10-0014-01 and 16-10-0015-01 will be updated on November 27.
Next release
Data from the Monthly Survey of Manufacturing for October will be released on December 17.
Contact information
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