Monthly Survey of Manufacturing, September 2023
Manufacturing sales rose 0.4% to $72.8 billion in September, on higher sales in 10 of 21 subsectors, led by the petroleum and coal product (+6.3%), wood (+2.9%), and machinery (+1.3%) subsectors. The gains were partially offset by lower sales of chemicals (-1.8%) and motor vehicle parts (-2.6%). On a quarterly basis, total sales rose 1.3% in the third quarter of 2023, mainly on higher sales of petroleum and coal (+8.5%) and food (+3.6%) products. On a year-over-year basis, sales increased 3.3% in September.
Total manufacturing sales in constant dollars declined 0.6% in September, indicating a lower volume of goods sold. The Industrial Product Price Index was up 0.4% in September.
Sales of petroleum and coal products increase the most
Sales of petroleum and coal products rose 6.3% to $9.1 billion in September, the highest level since January 2023. The gain was mainly attributable to higher prices of refined petroleum energy products (including liquid biofuels) (+3.6%) and to a lesser extent, higher volumes (+0.7%). Prices of crude oil and bitumen rose 10.1% in September, partly as Saudi Arabia and Russia announced that they had extended a voluntary oil production cut through the end of the year. Russia also put in place a ban on exports of gasoline and diesel fuel, further impacting prices of refinery energy products.
On a quarterly basis, petroleum and coal sales increased 8.5% in the third quarter of 2023, following two consecutive quarterly declines. Meanwhile, exports of refined petroleum energy products (including liquid biofuels) decreased 11.5% month over month in September.
Wood product sales increased 2.9% to $3.1 billion in September, the fourth consecutive monthly gain. On a quarterly basis, wood product sales rose 6.5% in the third quarter of 2023, following five consecutive quarterly declines. The wildfires in 2023 impacted production in many sawmills across Canada. The prices of logs, pulpwood and other forestry products have been trending upward since June 2023, rising 3.5% in September. This impacted the price of lumber and other sawmill products which rose 0.4% in September while their exports posted the fifth consecutive monthly gain, up 1.0% in the month.
Sales of chemicals declined 1.8% to $5.5 billion in September, mainly on lower sales of resin, synthetic rubber, and artificial and synthetic fibres and filaments (-24.8%) and basic chemicals (-9.7%). Maintenance shutdowns in some major petrochemical and resin plants in Alberta and Ontario were mainly responsible for the declines. On a quarterly basis, sales of chemical products fell 3.5% in the third quarter of 2023, while year over year, they were down 4.5% in September.
Sales increase in five provinces, led by Alberta and Quebec
Manufacturing sales rose in five provinces in September, led by Alberta and Quebec. Ontario posted the largest decrease.
In Alberta, sales rose 4.3% to $9.1 billion in September, the third consecutive monthly increase, led by the petroleum and coal (+13.4%) and fabricated metal (+14.4%) product subsectors. Sales of chemicals posted the largest decrease, down 5.6% to $1.2 billion in September. Meanwhile, the petroleum and coal subsector mainly contributed to an 8.9% increase in total sales in Edmonton in September. On a quarterly basis, total sales in Alberta rose 6.3% to $26.1 billion in the third quarter of 2023.
Sales in Quebec increased 0.7% to $17.7 billion in September, mostly on higher sales of petroleum and coal products (+10.7%) and production of aerospace products and parts (+5.8%). The gains were partially offset by an 11.6% decline in sales of machinery. With the increase in September, total sales in Quebec were up 1.9% in the third quarter of 2023 and increased 0.3% on a yearly basis in September. In Québec, total sales rose 5.8% to $2.1 billion in September, mainly driven by higher sales of petroleum and coal products, while in Montréal, total sales were down 1.7%.
In Ontario, sales edged down 0.3% to $32.9 billion in September, mainly on lower sales of motor vehicle parts (-2.4%) and fabricated metals (-3.4%). The decline in sales of motor vehicle parts in September followed significant sales posted for August. Exports of motor vehicle engines and motor vehicle parts fell 2.7%. On a quarterly basis, total sales in Ontario edged down 0.1% in the third quarter of 2023, while they were up 7.9% on a year-over-year basis in September.
Total inventories increase
Total inventories increased 1.5% to $123.4 billion in September, on higher goods in process (+2.4%), raw material (+1.1%) and finished product (+1.3%) inventories. Widespread gains were observed across 12 of 21 subsectors, led by the petroleum and coal (+4.0%), primary metal (+2.8%), and beverage and tobacco (+9.0%) subsectors. Inventories of plastic and rubber products decreased the most, down 2.9% to $4.3 million in September.
The inventory-to-sales ratio rose from 1.68 in August to 1.70 in September. This ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.
Unfilled orders decline
Unfilled orders fell 1.2% to $101.9 billion in September, primarily on a 1.6% decline in unfilled orders in the aerospace product and parts industry. Production of aerospace products and parts often increase at the end of each quarter, resulting in lower unfilled orders.
Capacity utilization rate declines
The capacity utilization rate (not seasonally adjusted) for the total manufacturing sector decreased from 80.2% in August to 78.9% in September, on lower production. The declines in the capacity utilization rates were more pronounced in the petroleum and coal (-5.5 percentage points), transportation equipment (-2.6 percentage points) and chemical (-3.2 percentage points) subsectors. The capacity utilization rate of primary metal manufacturing increased 1.7 percentage points in September.
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; apparel; 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 industry groups, 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 November 22.
Data from the Monthly Survey of Manufacturing for October will be released on December 14.
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