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Industrial capacity utilization rates
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Canadian industries operated at 81.3% of their production capacity in the third quarter, up 1.4 percentage points from 79.9% in the previous quarter.
This increase in the industrial capacity utilization rate was widespread. It comes from 13 of the 21 major manufacturing industries and from all non-manufacturing industries covered except for the forestry and logging industry.
Renewed growth following a dip in the previous quarter
Manufacturing: Transportation equipment industry biggest contributor to the rise in capacity utilization
Capacity utilization in the manufacturing sector increased from 79.5% in the second quarter to 81.1% in the third quarter.
The manufacturing transportation equipment industry was by far the largest contributor to the increase in capacity use in the manufacturing sector. Capacity use in this industry rose 7.1 percentage points in the third quarter to 89.1% following a decline of 2.1 percentage points in the previous quarter.
Note to readers
The industrial capacity utilization rate is the ratio of an industry's actual output to its estimated potential output. For most industries, the annual estimates are obtained from the Capital and Repair Expenditures Survey while the quarterly pattern is derived from output-to-capital ratio series, the output being the real gross domestic product at factor cost, seasonally adjusted, by industry.
This program covers all manufacturing and selected non-manufacturing industries.
At the time of this release, rates have been revised back to the first quarter of 2006 to reflect updated source data.
Significant gains in motor vehicle and parts manufacturing, ship and boat building, and railroad rolling stock manufacturing led this growth. Motor vehicle and parts production rose sharply compared with the previous quarter. However, second quarter production was substantially reduced by supply chain disruptions following the tsunami in Japan. In comparison, the production level in the third quarter, for all practical purposes, returned to the first quarter level, which was slightly affected by the natural disaster.
Other major contributors to the rise in the manufacturing sector were machinery, chemical products, beverages, metal products and paper.
Higher production of agricultural, construction and mining machinery, along with metalworking machinery, helped to increase the capacity utilization rate in the machinery manufacturing industry from 86.1% to 91.0%.
The chemical manufacturing industry saw its capacity utilization increase from 77.7% to 82.1%, mainly as a result of the expanded production of pharmaceuticals and medicine.
Soft drink manufacturers, breweries, wineries and distilleries all increased production in the third quarter after reporting a decline in the previous quarter. This turnaround enabled them to raise their capacity use from 70.4% to 75.2%.
Manufacturing: Capacity utilization rate gradually approaching 2007 level
The overall manufacturing industry increase was limited by declines, particularly in the food, electrical equipment, appliance and component, plastics and primary metal industries.
A decline in production in the third quarter for almost all food categories reduced the capacity use in the food manufacturing industry from 80.3% to 77.8%.
The electrical equipment, appliance and component manufacturing industry operated at 68.3% of its capacity, down from 72.2% in the previous quarter. This decline was a result of weaker demand for household appliances, electrical equipment and other electrical equipment except lighting.
Non-manufacturing: Strength in the mining and oil and gas extraction industry
In the non-manufacturing sector, capacity utilization increased in all industries except forestry and logging.
Capacity use in the mining and oil and gas extraction industry increased from 79.7% in the second quarter to 82.1% in the third quarter. Higher demand for support services for mining and oil and gas extraction, combined with increased oil extraction, more than offset the decline in gas extraction.
Despite a decrease in non-residential construction, stronger activity in residential construction and engineering enabled the construction industry to operate at 77.3% capacity, up slightly from 76.7% in the second quarter.
The electric power generation, transmission and distribution industry saw its rate edge up from 91.1% to 91.3% in response to weak growth in electricity demand.
Capacity utilization in the forestry and logging industry decreased from 93.5% to 91.1% because of reduced production. However, the industry continues to operate at a high capacity level despite this decrease.
Available on CANSIM: table 028-0002.
Definitions, data sources and methods: survey number 2821.
Data on industrial capacity utilization rates for the fourth quarter will be released on March 14, 2012.
For more information, or to enquire about the concepts, methods or data quality of this release, contact Luc Provençal (613-951-1960; luc.provencal@statcan.gc.ca), Investment and Capital Stock Division.
Table 1
| Third quarter 2010r | Second quarter 2011r | Third quarter 2011 | Second quarter to third quarter 2011 | Third quarter 2010 to third quarter 2011 | |
|---|---|---|---|---|---|
| % | percentage point change | ||||
| Total industrial | 77.5 | 79.9 | 81.3 | 1.4 | 3.8 |
| Forestry and logging | 91.4 | 93.5 | 91.1 | -2.4 | -0.3 |
| Mining and oil and gas extraction | 76.9 | 79.7 | 82.1 | 2.4 | 5.2 |
| Oil and gas extraction | 82.4 | 85.3 | 88.2 | 2.9 | 5.8 |
| Mining | 65.7 | 69.3 | 71.2 | 1.9 | 5.5 |
| Electric power generation, transmission and distribution | 87.9 | 91.1 | 91.3 | 0.2 | 3.4 |
| Construction | 75.3 | 76.7 | 77.3 | 0.6 | 2.0 |
| Manufacturing | 76.8 | 79.5 | 81.1 | 1.6 | 4.3 |
| Food | 80.9 | 80.3 | 77.8 | -2.5 | -3.1 |
| Beverage and tobacco products | 71.1 | 69.0 | 73.8 | 4.8 | 2.7 |
| Beverage | 72.5 | 70.4 | 75.2 | 4.8 | 2.7 |
| Tobacco | 62.7 | 60.1 | 65.5 | 5.4 | 2.8 |
| Textiles | 71.2 | 79.0 | 79.0 | 0.0 | 7.8 |
| Textile mills | 77.0 | 90.6 | 90.4 | -0.2 | 13.4 |
| Textile product mills | 65.3 | 67.7 | 67.9 | 0.2 | 2.6 |
| Clothing | 79.3 | 80.6 | 82.8 | 2.2 | 3.5 |
| Leather and allied products | 66.7 | 59.2 | 63.8 | 4.6 | -2.9 |
| Wood products | 68.2 | 74.4 | 74.2 | -0.2 | 6.0 |
| Paper | 85.3 | 90.8 | 91.6 | 0.8 | 6.3 |
| Printing and related support activities | 70.1 | 71.1 | 69.4 | -1.7 | -0.7 |
| Petroleum and coal products | 79.1 | 74.5 | 75.3 | 0.8 | -3.8 |
| Chemical | 74.2 | 77.7 | 82.1 | 4.4 | 7.9 |
| Plastics and rubber products | 70.6 | 75.9 | 74.8 | -1.1 | 4.2 |
| Plastic products | 68.7 | 72.3 | 70.7 | -1.6 | 2.0 |
| Rubber products | 79.2 | 92.5 | 93.6 | 1.1 | 14.4 |
| Non-metallic mineral products | 76.6 | 77.8 | 78.3 | 0.5 | 1.7 |
| Primary metal | 82.1 | 83.2 | 82.3 | -0.9 | 0.2 |
| Fabricated metal products | 72.2 | 75.5 | 76.5 | 1.0 | 4.3 |
| Machinery | 76.7 | 86.1 | 91.0 | 4.9 | 14.3 |
| Computer and electronic products | 87.1 | 93.8 | 94.0 | 0.2 | 6.9 |
| Electrical equipment, appliance and component | 70.6 | 72.2 | 68.3 | -3.9 | -2.3 |
| Transportation equipment | 80.6 | 82.0 | 89.1 | 7.1 | 8.5 |
| Furniture and related products | 71.5 | 73.0 | 71.6 | -1.4 | 0.1 |
| Miscellaneous manufacturing | 75.8 | 74.6 | 75.5 | 0.9 | -0.3 |
