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Monthly Survey of Manufacturing, January 2020

Released: 2020-03-17

Manufacturing sales were down 0.2% to $56.1 billion in January, the fifth consecutive monthly decline.

Sales decreased in 9 of 21 industries, led by lower sales in the transportation equipment and petroleum and coal products industries. The food industry posted the largest gain.

Chart 1  Chart 1: Manufacturing sales
Manufacturing sales

In volumes terms, manufacturing sales decreased 0.4%.

Transportation equipment and petroleum and coal product industries post the largest declines

Sales of transportation equipment fell for the second consecutive month, down 6.0% to $9.9 billion in January. The decline was mainly attributable to lower sales in the motor vehicle assembly (-12.3%) and motor vehicle parts (-1.6%) industries. This reflected longer temporary shutdowns at some assembly plants as well as the recent closure of the General Motors plant in Oshawa.

Sales in the petroleum and coal product industry fell 5.2% to $5.9 billion, following a 1.9% increase in December. The decrease in January reflected lower sales volumes and lower prices, as prices for the industry were down 2.6% according to the Industrial Product Price Index. Partial shutdowns at some Canadian refineries for maintenance work during the month were a major contributor to the decline in volumes sold (-3.3%).

Manufacturing sales rose in 12 industries in January, led by the food (+2.6%), non-metallic mineral product (+15.7%), machinery (+4.6%) and fabricated metal product (+4.6%) industries.

Sales decrease in six provinces

Manufacturing sales were down in six provinces in January, led by Ontario and British Columbia. Quebec reported the largest monthly increase.

In Ontario, sales fell 1.4% to $25.4 billion in January, the second consecutive monthly decrease. The decline in January was largely attributable to lower sales in the motor vehicle (-13.6%) and motor vehicle parts (-2.7%) industries. These declines were partially offset by higher sales in the non-metallic mineral product and food industries.

Sales in British Columbia fell 5.1% in January as manufacturers in 13 of 21 industries reported lower sales. This was the lowest level of sales since March 2017, reflecting lower sales in the non-durable (-7.3%) and durable (-3.1%) goods industries.

Following two consecutive monthly declines, sales in Quebec rose 3.5% to $14.4 billion. The increase was largely attributable to higher sales in the transportation equipment (+5.6%), machinery (+13.9%) and fabricated metal product (+9.0%) industries.

Manufacturing sales in Alberta rose 5.2% to $6.3 billion, following two months of declines. Sales rose in 13 of 21 industries, led by the food and machinery industries.

Manufacturing sales in census metropolitan areas

On an unadjusted basis, manufacturing sales decreased in 7 of 12 census metropolitan areas in January, led by Montréal (-3.4%) and Winnipeg (-15.3%).

Manufacturing sales in Montréal fell 3.4% to $6.0 billion, largely reflecting lower sales in the transportation equipment (-14.2%) and petroleum and coal products (-21.0%) industries.

In Winnipeg, lower sales of transportation equipment and chemicals were behind most of the decline in January.

Following two consecutive monthly declines, sales in Regina rose 94.6% in January, as the result of higher sales in the chemical and, to a lesser extent, petroleum and coal products industries.

Inventory levels increase

Inventory levels increased 0.4% to $87.5 billion in January, following a 0.6% decline in December. Inventories were up in 12 of 21 industries, led by the machinery (+5.1%) and transportation equipment (+1.5%) industries. These increases were partly offset by declines in the primary metal (-2.6%) and petroleum and coal products (-3.2%) industries.

Chart 2  Chart 2: Inventory levels increase
Inventory levels increase

The inventory-to-sales ratio increased from 1.55 in December to 1.56 in January. 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  Chart 3: The inventory-to-sales ratio increases
The inventory-to-sales ratio increases

Unfilled orders rise

Unfilled orders rose 0.5% in January to $97.9 billion, following three months of declines. The growth in unfilled orders was attributable to the transportation equipment industry and, to a lesser extent, the chemical industry.

Chart 4  Chart 4: Unfilled orders rise
Unfilled orders rise

New orders rose 0.8% to $56.6 billion in January, mostly reflecting higher new orders in the transportation equipment, fabricated metal product, food as well as non-metallic mineral product industries.

Capacity utilization rate

The unadjusted capacity utilization rate for the manufacturing sector increased 0.5 percentage points from 76.8% in December to 77.3% in January.

Chart 5  Chart 5: The capacity utilization rate increases
The capacity utilization rate increases

The capacity utilization rate of the plastic and rubber products industry rose 6.8 percentage points to 71.0% in January, reflecting increased production of rubber and plastic products, following seasonal shutdowns at some facilities.

The capacity utilization rate for the petroleum and coal product industry declined 2.4 percentage points to 84.7% in January. Turnaround and maintenance work at some refineries as well as lower production at other refineries were behind most of the decline in the capacity utilization rate.

Impact of coronavirus and the railway blockades on the manufacturing sector

Statistics Canada is monitoring the impacts of the coronavirus (COVID-19) and the railway blockades on the Canadian manufacturing sector. With the collection of data for the February 2020 reference month and later months, the Monthly Survey of Manufacturing contains supplementary questions for a sample of about 4,700 respondents to assess the impact of these two events on sales and inventories. The first results, for reference month February 2020, will be released April 16.






Sustainable Development Goals

On January 1, 2016, the world officially began implementation of the 2030 Agenda for Sustainable Development—the United Nation's 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.

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 monthly 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 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 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.

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 March 26.

Next release

Data from the Monthly Survey of Manufacturing for February will be released on April 16.

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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