Industrial capacity utilization rates, first quarter 2017
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First quarter 2017
Canadian industries operated at 83.3% of their production capacity in the first quarter, up from 81.8% in the previous quarter and the highest level since the third quarter of 2007.
Increases in capacity utilization in manufacturing, construction, and mining and quarrying more than offset the declines in oil and gas extraction and forestry and logging. Capacity utilization in electric power generation, transmission and distribution were unchanged.
Manufacturing gains led by fabricated metal product and food manufacturing
The manufacturing industry drove the increase in the capacity utilization rate in the first quarter, operating at 83.4% of its capacity, up 1.5 percentage points from the previous quarter. The fabricated metal product manufacturing and food manufacturing industries were the primarily sources of that growth.
The capacity utilization rate rose in 15 of the 21 major manufacturing industries, representing approximately 80% of the gross domestic product in the manufacturing industry.
After falling for four consecutive quarters, the capacity utilization rate in the fabricated metal product manufacturing industry rebounded from 72.0% in the fourth quarter to 76.8% in the first quarter. The gain was attributable to increased production in most subsectors of fabricated metal product manufacturing.
The capacity utilization rate in the food manufacturing industry rose for a fifth consecutive quarter, reaching a record high 86.8% in the first quarter. Increased production in most subsectors of this industry accounted for the gain.
Capacity utilization in the machinery manufacturing industry rose 3.4 percentage points to 79.2% in the first quarter. This gain was attributable to higher production of most types of machinery.
The overall increase in the manufacturing sector was partially offset by decreases, particularly in chemical product manufacturing.
The utilization rate of chemical product manufacturers in the first quarter was 85.8%, down from 89.4% in the previous quarter. Lower production of pharmaceutical products and medication was the main reason for this decline.
Construction and mining and quarrying continues to advance
The capacity utilization rate in construction rose for only the second time in nine quarters, from 84.5% in the fourth quarter to 86.6% in the first quarter. As in the previous quarter, residential construction and repairs were mostly responsible for the increase.
Due to an acceleration in support activities for mining and oil and gas extraction, the capacity utilization rate in the mining and quarrying subsector rose 5.9 percentage points to 79.4% in the first quarter. This gain followed a 4.5 percentage point increase in the previous quarter.
After edging up 0.1 percentage points in the fourth quarter, the capacity utilization rate in oil and gas extraction fell 0.3 percentage points to 80.8% in the first quarter. The decline was attributable to a lower volume of oil extraction, which more than offset increased gas extraction activities.
Note to readers
The industrial capacity utilization rate is the ratio of an industry's actual output to its estimated potential output.
For most industries, the annual estimates are obtained from the Annual Survey of Manufacturing and Logging Industries while the quarterly pattern is derived from the output-to-capital ratio series, the output being the real gross domestic product at basic prices, seasonally adjusted, by industry.
This program covers all manufacturing industries as well as forestry and logging, mining, quarrying and oil and gas extraction, electric power generation, transmission and distribution, and construction industries.
With this release of industrial capacity utilization rates, the data were revised back to the first quarter of 2016 to reflect the latest revisions to the source data.
Data on industrial capacity utilization rates for the second quarter will be released on September 8.
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The Methodological Guide: Canadian System of Macroeconomic Accounts (13-607-X) is available.
The User Guide: Canadian System of Macroeconomic Accounts (13-606-G) is also available. This publication will be updated to maintain its relevance.
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