Analysis — January 2015
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In January, wholesale sales recorded the largest monthly decline since January 2009, decreasing 3.1% to $53.7 billion, which more than offset the gain in December. Sales were down in four of seven subsectors, led by motor vehicle and parts. Excluding this subsector, wholesale sales declined 1.3%.
In volume terms, wholesale sales fell 3.3%.
Lower sales in four subsectors
The motor vehicle and parts subsector recorded the largest decline in January, falling 11.3% to $9.0 billion. Lower sales in the motor vehicle industry (-15.0%) accounted for most of the decline, bringing this industry and its subsector to their lowest levels since April 2014. Imports and manufacturing sales of motor vehicles also decreased in January. Retail sales at motor vehicle and parts dealers were down in October, November and December 2014.
Sales in the building material and supplies subsector decreased 5.3% to $7.7 billion, the lowest level since May 2014. Every industry posted lower sales, led by the electrical, plumbing, heating and air-conditioning equipment and supplies industry, which fell 9.8% in January, offsetting the gain in December.
After five consecutive monthly gains, sales in the miscellaneous subsector declined 2.7% to $7.2 billion. The agricultural supplies industry led the decrease (-11.2%), partially offsetting the gain in December.
Sales in the farm product subsector decreased 8.6% to $692 million, the second decline in three months. Despite the recent declines, sales in this subsector were 8.4% higher than in January 2014.
Sales in the personal and household goods subsector ($7.5 billion) and the machinery, equipment and supplies subsector ($11.3 billion) were unchanged in January. In the personal and household goods subsector, lower sales in the textile, clothing and footwear industry (-4.8%) and the home furnishings industry (-8.7%) were offset by gains in the other four industries. In the machinery, equipment and supplies subsector, lower sales in the computer and communications equipment and supplies industry (-3.2%) were almost entirely offset by gains elsewhere.
Sales down in five provinces
Wholesale sales declined in five provinces in January, representing 67% of total wholesale sales. Ontario accounted for most of the decrease.
In Ontario, sales fell 5.5% to $26.1 billion, offsetting December's gain. Every wholesale subsector declined, led by motor vehicle and parts.
Widespread declines across most subsectors were also recorded in British Columbia and Nova Scotia. Sales in British Columbia declined for the first time in five months, falling 2.3% to $5.2 billion, led by lower sales in the building material and supplies subsector. In Nova Scotia, sales fell 11.7% to $724 million, the lowest level since April 2014.
After five consecutive monthly gains, sales in Saskatchewan were down 1.8% to $2.3 billion. Declines in the miscellaneous subsector and the farm product subsector accounted for the decrease.
Inventories rise in January
Inventories rose for a 13th consecutive month, up 1.3% to $70.2 billion in January. Six of seven subsectors, representing 91% of total wholesale inventories, posted not only monthly gains but also record high levels in January.
In dollar terms, the largest gain was in the machinery, equipment and supplies subsector (+2.0%), a second consecutive increase.
Inventories grew for a fifth consecutive month in the motor vehicle and parts subsector (+2.8%) and a second consecutive month in the personal and household goods subsector (+1.3%).
Inventories in the building material and supplies subsector (+0.6%) and the miscellaneous subsector (+0.5%) both rose for the 11th time in 12 months.
Inventories declined 0.5% in the food, beverage and tobacco subsector, following 10 consecutive monthly gains.
The inventory-to-sales ratio rose from 1.25 in December to 1.31 in January, the highest ratio since June 2009 when it was 1.34.
The inventory-to-sales ratio is a measure of the time in months required to exhaust inventories if sales were to remain at their current level.
Note to readers
All data in this release are seasonally adjusted and in current dollars, unless otherwise noted. For more information on seasonal adjustment, see Seasonally adjusted data – Frequently asked questions.
Total wholesale sales expressed in volume are calculated by deflating current dollar values using relevant price indexes. The wholesale sales series in chained (2007) dollars is a chained Fisher volume index with 2007 as the reference year. For more information, see Sales in volume for Wholesale Trade.
The Monthly Wholesale Trade Survey covers all industries within the wholesale sector as defined by the North American Industry Classification System (NAICS), with the exception of oilseed and grain merchant wholesalers (NAICS 41112), petroleum and petroleum products merchant wholesalers (NAICS 412) and business-to-business electronic markets, and agents and brokers (NAICS 419).
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