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Industrial capacity utilization rates, first quarter 2019

Released: 2019-06-07

Industrial capacity use

80.9%

First quarter 2019

-0.9 pts decrease

(quarterly change)

Canadian industries operated at 80.9% of their production capacity in the first quarter, down from 81.8% in the previous quarter. This was the third consecutive quarterly decline.

The mining, quarrying and oil and gas extraction sector was the main source of this decline. Lower capacity utilization in mining, quarrying and oil and gas extraction, in manufacturing, and in forestry and logging more than offset the slight increase in electric power generation, transmission and distribution.

Capacity utilization in the mining, quarrying and oil and gas extraction sector continues to decline

After declining 1.2 percentage points in the previous quarter, capacity utilization in the mining, quarrying and oil and gas extraction sector decreased to 79.6% in the first quarter (-2.3 percentage points).

Chart 1  Chart 1: Industrial capacity utilization in non-manufacturing industries
Industrial capacity utilization in non-manufacturing industries

Capacity utilization in the mining and quarrying industry was down 4.3 percentage points to 72.6% in the first quarter. This was the second consecutive quarterly decline. This decline was due to decreased activity in most industry subsectors, including support activities for oil and gas extraction which are included in this industry.

Capacity utilization in the oil and gas extraction industry decreased from 84.2% in the fourth quarter of 2018 to 82.9% in the first quarter of 2019. The Government of Alberta imposed temporary limitations on oil sands extraction early in the first quarter, which contributed to this decline.

Conversely, capacity utilization in the electric power generation, transmission and distribution industry edged up 0.4 percentage points to 86.2% in the first quarter. This was the third straight quarterly increase, as colder temperatures in most of Canada increased the electricity demand for heating.

Capacity utilization in the construction industry was unchanged at 85.4% in the first quarter, following two consecutive quarterly declines.

Lower capacity utilization in the manufacturing sector

The manufacturing sector's capacity utilization rate fell 0.9 percentage points to 78.2% in the first quarter. This decline was driven by durable goods manufacturing and coincided with decreased production in several industries. Year over year, the capacity utilization rate in manufacturing decreased by 2.1 percentage points.

Year over year, the capacity utilization rate was down in 16 of the 21 major manufacturing groups, representing approximately three-quarters of the gross domestic product in the manufacturing sector.

Chart 2  Chart 2: Year-over-year change by industry (first quarter 2019 compared with first quarter 2018)
Year-over-year change by industry (first quarter 2019 compared with first quarter 2018)

Capacity utilization among manufacturers of non-metallic mineral products decreased by 11.0 percentage points to 60.1% in the first quarter. This decline was mainly due to seasonality and delays in home construction starts, as this industry supplies inputs for building construction. Year over year, this capacity utilization rate rose 3.2 percentage points.

In food manufacturing, the capacity utilization rate fell 2.7 percentage points to 78.3% in the first quarter. Year over year, this rate decreased by 4.1 percentage points, which coincided with a decline in production and lower inventory levels.

The widespread decreases in manufacturing were moderated, particularly by increases in petroleum and coal product manufacturing and transportation equipment manufacturing.

The capacity utilization rate among petroleum and coal product manufacturers rose 8.6 percentage points to 86.3% in the first quarter, following a significant decline in the previous quarter. This increase was mostly due to higher production, after declines in the previous quarter following refurbishment and maintenance work at certain refineries. Year over year, this industry posted a 4.7-percentage-point decrease.

The capacity utilization rate of transportation equipment manufacturers rose 2.6 percentage points to 82.4% in the first quarter. This increase was mainly due to higher production in aerospace products and parts and miscellaneous transportation equipment. The year-over-year decrease was 5.9 percentage points in this industry.


  Note to readers

The industrial capacity utilization rate is the ratio of an industry's actual output to its estimated potential output.

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 the industrial capacity utilization rates, the data have been revised back to the first quarter of 2018 to reflect the latest revisions to the source data.

Next release

Data on industrial capacity utilization rates for the second quarter will be released on September 11.

Products

The Latest Developments in the Canadian Economic Accounts (Catalogue number13-605-X) is available.

The User Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-606-G) is available.

The Methodological Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-607-X) is available.

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).

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