Monthly Survey of Manufacturing, October 2021
Manufacturing sales rebounded in October, rising 4.3% to $61.2 billion, following a 2.8% decline in September. Sales increased in 17 of 21 industries in October, led by the motor vehicle, motor vehicle parts, and primary metal industries. The aerospace product and parts industry posted the largest decline.
Sales in constant dollars increased 3.1% in October, indicating a higher volume of goods sold, but also inflationary pressures. The Industrial Product Price Index increased 1.3% month over month in October, while the Raw Materials Price Index rose 4.8%.
Motor vehicle production increases despite ongoing semiconductor chip shortage
Motor vehicle production increased in October, despite the global semiconductor supply disruption. However, the growth in motor vehicle sales in October follows a substantial decrease (-35.8%) in September which was the largest drop since the pandemic began. Sales of motor vehicles increased 61.0% to $3.1 billion in October, while motor vehicle part sales rose 23.1% to $2.2 billion. Meanwhile, exports of motor vehicles and parts increased 30.8%. On a year-over-year basis, sales of motor vehicles were down 30.1%. Semiconductors chips are expected to be in short supply for the foreseeable future and to improve around mid-2022, as more supplies become available and chip manufacturers operate at a higher capacity.
Sales of the primary metal industry rose 4.0% to $5.4 billion in October, driven by higher sales of alumina and aluminum products. Sales in the alumina and aluminum production and processing industry reached their highest level on record in October, rising 10.2% to $1.4 billion. On a year-over-year basis, sales in the primary metal industry rose 41.3%. Meanwhile, primary metal volume sales increased 2.6% month over month. The curbs that China imposed on its metal production and energy use contributed to the increase in prices of unwrought aluminum and aluminum alloy products in October (+4.6%).
Sales of chemical products also rose to their highest level on record, up 3.7% to $5.3 billion in October, on higher prices and volumes and mainly due to gains in the basic chemical and pesticide, fertilizer and other agricultural chemical industries. Chemical product sales in constant dollars were up 2.9%. While prices of petrochemicals have been rising due to the pandemic and supply chain disruptions, strong food demand, along with the higher cost of natural gas—an important feedstock to fertilizer production—have accounted for the substantial increase in prices of fertilizers in the past few months. Natural gas prices rose 21.0% in October. Total sales in the chemical product industry increased 18.3% year over year.
Sales also increased in the petroleum and coal (+2.4%), plastic and rubber (+5.1%) and food (+0.7%) product industries in October.
Aerospace production fell 8.3% to $1.4 billion in October, following a 1.7% decline in September. Production of aerospace products and parts was down 40.2% compared with the pre-pandemic level in February 2020 and was 11.8% lower on a year-over-year basis.
Motor vehicle production rebounds in Ontario
Manufacturing sales increased in six provinces in October, led by Ontario and Alberta. Meanwhile, sales in New Brunswick decreased the most.
Sales in Ontario increased 8.6% to $27.2 billion in October, on higher sales of motor vehicles (+65.5%) and motor vehicle parts (+24.6%). The strong increase in motor vehicle sales followed a significant decline in September (-37.2%), which had been due to a marked production cut at the majority of auto assembly plants. Despite the increase in October, sales were down compared with the same month a year earlier in the motor vehicle (-30.2%) and in the motor vehicle part (-18.2%) industries. Month over month, the gains in Ontario were partially offset by a decline in the production of aerospace products (-22.1%) and a decrease in the sales of petroleum and coal products (-3.6%).
Sales in Alberta increased 2.9% to $7.2 billion, following four consecutive monthly declines, on higher sales of petroleum and coal (+9.1%), machinery (+13.3%) and wood products (+9.0%). Food product sales posted the largest decrease, down 3.3% to $1.8 billion in October. On a year-over-year basis, total sales in Alberta rose 32.9%.
Sales in New Brunswick decreased 3.6% to $1.5 billion in October on lower sales of non-durable goods (-4.2%). Despite the decline, sales were 9.7% higher compared with the same month a year earlier.
Sales in Toronto partially rebound despite stalled motor vehicle manufacturing
Manufacturing sales increased in 8 of the 12 census metropolitan areas in October, led by Toronto, Vancouver, and Québec City, while sales in Hamilton declined the most.
Following a 2.8% decline in September, sales in Toronto increased 1.3% to $10.2 billion in October, mostly on higher sales of machinery (+8.2%) and motor vehicle parts (+7.8%). Motor vehicle sales posted the largest decline in October, down 8.5% to $1.1 billion, the second lowest sales figure since May 2021. Total sales in Toronto fell 1.6% year over year in October.
In Vancouver, sales rose 3.0% from September to $2.7 billion in October, on widespread increases in 17 of 21 industries, led by petroleum and coal and computer and electronic products. This brought year-over-year sales in Vancouver up 9.8% in October.
Sales in Québec City rose 4.6% to $1.7 billion in October, primarily attributable to higher sales of non-durable goods (+6.7%). Production of ship and boat building posted the largest decline.
Meanwhile, sales in Hamilton fell 4.0% to $1.9 billion in October, mainly on lower sales of plastics and rubber products.
Record high inventory levels continue
Total inventories increased 1.5% to a record high $99.6 billion in October, as a result of higher inventories in the primary metal (+4.4%), petroleum and coal (+5.2%) and food (+1.8%) industries, mainly attributable to higher raw material prices. Year over year, total inventories rose 15.2%.
The inventory-to-sales ratio decreased from 1.67 in September to 1.63 in October. The ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.
Unfilled orders edge downward
Total value of unfilled orders edged down 0.1% to $95.4 billion in October, mostly due to lower unfilled orders of fabricated metals (-3.3%) and aerospace products (-0.4%). This was mostly offset by higher unfulfilled orders of machinery (+1.8%) and electrical equipment, appliances, and components (+6.2%). Year over year, the value of unfilled orders was up 1.8%.
The total value of new orders increased 1.9% to $61.1 billion in October, mainly attributable to higher new orders of transportation equipment (+9.9%).
Capacity utilization rate increases on higher production
The capacity utilization rate (not seasonally adjusted) for the total manufacturing sector increased from 74.7% in September to 77.1% in October on higher production.
The capacity utilization rate rose in 11 of 21 industries in October on higher production in the transportation equipment (+11.9 percentage points), chemical (+6.4 percentage points), and fabricated metal (+2.6 percentage points) product industries. The capacity utilization rate in the petroleum manufacturing industry fell 2.1 percentage points.
Sustainable development goals
On January 1, 2016, the world officially began implementing the 2030 Agenda for Sustainable Development—the United Nations' transformative plan of action that addresses urgent global challenges over the following 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 sustainable development goals. This release will be used to help measure the following goal:
Note to readers
Monthly data in this release are seasonally adjusted and are expressed in current dollars, unless otherwise specified.
Seasonally adjusted data are data that have been modified to eliminate the effect of seasonal and calendar influences to allow for more meaningful comparisons of economic conditions from period to period. For more information on seasonal adjustment, see Seasonally adjusted data – Frequently asked questions.
Trend-cycle estimates are included in selected charts as a complement to the seasonally adjusted series. These data represent a smoothed version of the seasonally adjusted time series and provide information on longer-term movements, including changes in direction underlying the series. For information on trend-cycle data, see Trend-cycle estimates – Frequently asked questions.
Both seasonally adjusted data and trend-cycle estimates are subject to revision as additional observations become available. These revisions could be large and could even lead to a reversal of movement, especially for reference months near the end of the series or during periods of economic disruption.
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 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 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 working 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.
Each month, the Monthly Survey of Manufacturing releases preliminary data for the reference month and revised data for the previous three 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 December 22, 2021.
Data from the Monthly Survey of Manufacturing for November 2021 will be released on January 17, 2022.
Please note that the tables available on the website represent a subset of the data available with this release. The full dataset is available upon request by contacting Javad Sadeghzadeh (firstname.lastname@example.org).
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; email@example.com) or Media Relations (firstname.lastname@example.org).