Monthly Survey of Manufacturing, November 2016
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Manufacturing sales rose 1.5% in November to $51.8 billion, following a 0.6% decline in October. The increase was mainly the result of higher sales in the primary metal, petroleum and coal product, and chemical manufacturing industries.
Sales were up in 14 of the 21 industries, representing 68% of Canadian manufacturing sales.
In constant dollars, sales rose 1.2%, indicating that a higher volume of manufactured goods was sold in November. Prices for the manufacturing sector increased 0.3%, according to the Industrial Product Price Index.
Primary metal manufacturing sales lead the gain
Primary metal manufacturing sales rose 9.1% to $4.0 billion following two months of decline. This was the largest gain in dollar terms since April 2012. The increase in sales was widespread among all five primary metal manufacturing industries. However, the non-ferrous metal production and processing and the iron and steel pipes and tubes manufacturing industries posted the largest sales gain in dollars in November.
Petroleum and coal product sales increased 3.7% to $4.5 billion in November, their highest level since September 2015. The gain in November was mainly attributable to higher volumes reported by several oil refineries following partial shutdowns in September and October for maintenance and retooling work.
Sales in the chemical manufacturing industry rose 3.4% to $4.4 billion, the fifth increase in six months. A large part of the gain in November was from higher sales in petrochemical as well as pharmaceutical and medicine manufacturing.
Sales of wood products (+3.8%), food (+0.9%) and machinery (+2.7%) also increased in November.
In contrast, sales in the transportation equipment industry decreased 2.3% to $10.3 billion. The decline was mainly the result of decreases in the aerospace product and parts industry (-7.4%) and the other transportation equipment industry (-26.8%), which had posted a significant increase the previous month.
Sales up in every province except New Brunswick
Sales were up in nine provinces in November, led by Quebec and Alberta. Increases in these provinces were largely responsible for the total national gain. New Brunswick was the lone province to see a decline.
Following a 1.5% decrease in October, sales in Quebec rose 3.0% to $12.1 billion. The provincial increase was mainly due to higher sales in the petroleum and coal product and the primary metal manufacturing industries (+10.6%). Meanwhile, sales in the transportation equipment industry decreased 13.5%.
In Alberta, sales rose 3.9% to $5.4 billion in November, following two monthly decreases. Increases were recorded in 16 of the 21 industries, largely driven by a 4.7% increase in the chemical products industry and a 3.8% gain in the food industry.
In New Brunswick, manufacturing sales fell 2.4% to $1.3 billion, due to weaker sales of non-durable goods. This was the third consecutive monthly sales decline in this province.
Inventory levels fall
Inventory levels decreased 0.2% to $70.0 billion in November, following two consecutive monthly increases.
Inventories were down in 11 of 21 industries, with the aerospace product and parts (-2.5%), petroleum and coal products (-2.3%) and wood product (-2.2%) industries posting the largest declines. These declines were partially offset by a 1.7% increase in chemical product inventories.
The inventory-to-sales ratio declined from 1.38 in October to 1.35 in November. 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 are unchanged
Total unfilled orders for the manufacturing sector were unchanged at $89.1 billion in November, as fewer unfilled orders in the transportation equipment and the fabricated metal products industries were offset by more unfilled orders in the primary metal manufacturing and machinery manufacturing industries.
New orders rose for a third consecutive month, up 0.5% to $51.8 billion. The primary metal manufacturing, machinery manufacturing and chemical product manufacturing industries contributed the most to the increase in new orders at the national level.
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.
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 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 monthly exchange rate for the reference month (noon spot rate) established by the Bank of Canada is used for the conversion. The monthly average exchange rate is available in CANSIM table 176-0064.
Inventories and unfilled orders are reported at the end of the reference period. For most respondents, the noon spot 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 noon spot exchange rate on the day selected by the respondent is used. Note that because of exchange rate fluctuations, the noon spot 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. Noon spot exchange rate data are available in CANSIM table 176-0067.
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. During annual revisions, changes are made to seasonal adjustment parameters.
Real-time CANSIM tables
Data from the Monthly Survey of Manufacturing for December 2016 will be released on February 15, 2017.
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To enquire about the concepts, methods or data quality of this release, contact Bechir Oueriemmi (613-951-7938; firstname.lastname@example.org) or Michael Schimpf (613-863-4480; email@example.com), Manufacturing and Wholesale Trade Division.