Wholesale trade, February 2023

Released: 2023-04-17

Wholesale sales fall in February, after reaching a record high in January

Wholesale sales declined 1.7% to $85.6 billion in February. Sales fell in five of seven subsectors. The decrease of sales was mainly led by the motor vehicle and motor vehicle parts and accessories and the food, beverage and tobacco subsectors. Excluding motor vehicle and motor vehicle parts and accessories, wholesale sales were down 1.0%. Despite the monthly decrease in the sector, wholesale sales were higher (+7.4%) than in February 2022.

Constant dollar sales fell 1.8% in February 2023.

Chart 1 
Wholesale sales decrease in February

Lower sales of motor vehicle and motor vehicle parts and accessories drive the February decline

Motor vehicle and motor vehicle parts and accessories fell 5.5% to $12.4 billion in February, the third consecutive monthly decline and the lowest level for this subsector since September 2022. Sales decreased in two out of the three industry groups. However, the decrease was predominantly led by the drop of motor vehicles (-6.2% to $9.8 billion), accounting for the majority of the subsector movement. Lower production of motor vehicles and semiconductor shortages continued to steer sales downward for this subsector. Lower sales of motor vehicles aligned with the decreased import activity of related commodities in February 2023. Despite the monthly decline, sales of this subsector were higher (+7.6%) than in February 2022.

The food, beverage and tobacco products subsector reported a decline of sales (-3.9% to $15.1 billion) in February 2023, the first decrease since December 2022. Sales fell in two of the three industries. However, it was the food industry group (-4.1% to $13.5 billion) that contributed the most to the monthly decrease. The monthly drop for the subsector came after the surge of sales in previous months, in preparation for holidays and the new year.

Partially offsetting the decline in the wholesale sector was the machinery, equipment and supplies subsector, which reported an increase of 1.5% to $18.2 billion in February. Computer and communications equipment and supplies (+3.5% to $5.2 billion) and other machinery, equipment and supplies (+3.1% to $4.5 billion) were the industry groups that led the subsector growth in February.

Quebec leads provincial loss

Sales decreased in seven provinces in February, accounting for 87% of national sales. Quebec reported the largest decline, followed by British Columbia and Ontario.

Following two consecutive monthly increases, wholesale sales in Quebec dropped 3.3% to $15.0 billion in February. Sales for this province have declined in 6 of the past 12 months. The February decline marked the largest monthly change since November 2021. While sales fell in three of seven subsectors in February 2023, the largest decrease came from the food, beverage and tobacco subsector (-10.5% to $3.4 billion), followed by lower sales from the motor vehicle and motor vehicle parts and accessories (-8.7%) and the personal and household goods (-3.2%) subsectors.

Sales in British Columbia dropped 5.1% to $7.8 billion in February after increasing 15.4% in January. With sales down in four of the seven subsectors, building material and supplies led the decline, dropping 12.9% in February. The decline in this subsector was mainly attributable to the lumber, millwork, hardware and other building supplies industry. Production of softwood lumber continued to be curtailed in the province in February. Sales of machinery, equipment and supplies dropped 10.5% in February, after increasing 30.5% in January.

In Ontario, sales decreased 0.6% to $42.6 billion in February. This marked the first monthly decrease since September 2022. Sales were down in four of seven subsectors in February 2023; the driving force was a 6.1% decline in motor vehicle and motor vehicle parts and accessories.

Inventories continue to rise in February

Wholesale inventories rose 0.8% to $130.2 billion in February, the third consecutive monthly increase. Increased inventories were reported in six of the seven subsectors, led by the machinery, equipment and supplies subsector and the miscellaneous goods subsector.

Increasing for the second consecutive month, inventories in the machinery, equipment and supplies subsector rose 1.4% to $36.0 billion in February. While all four industry groups had higher inventories, growth was led by the construction, forestry, mining and other machinery and supplies industry (+1.3%), followed by the computer and communications equipment and supplies industry (+3.0%).

In the miscellaneous goods subsector, inventory levels increased 2.8% to $17.7 billion in February, the first monthly increase since September 2022. Inventories increased in six of the seven industry groups in February 2023, with over half of the increase coming from the agricultural supplies industry (+3.2% to $8.4 billion).

Slightly offsetting the increase of inventories of the wholesale sector, was the building material and supplies subsector, down 2.9% to $23.8 billion in February. While all three industry groups reported a decline in inventories, the largest contributor to the loss was the metal service centres industry group (-5.5% to $6.1 billion), followed by the lumber, millwork, hardware, and other building supplies industry group (-2.7% to $10.8 billion). The building material and supplies subsector accounted for the second-largest share of wholesale trade inventories at 18%.

The inventory-to-sales ratio increased from 1.51 in January to 1.52 in February. This ratio is a measure of the time (in months) required to exhaust inventories if sales were to remain at their current levels.

Products

The product "Monthly Wholesale Trade Survey: Interactive Tool" (Catalogue number71-607-X) is available online. This product is based on the data published in the tables of the Monthly Wholesale Trade Survey: 20-10-0074-01, 20-10-0076-01 and 20-10-0003-01.

Contact information

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