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Monthly Survey of Manufacturing, November 2017

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Released: 2018-01-19

Manufacturing sales rose 3.4% to a record high $55.5 billion in November, mainly due to higher sales in the transportation equipment, petroleum and coal product and chemical industries.

Overall, 12 of 21 industries, representing 81% of the manufacturing sector, posted increases in November.

Chart 1  Chart 1: Manufacturing sales rise
Manufacturing sales rise

Higher petroleum prices contributed to the overall increase in manufacturing sales. Once the effects of these and other price changes are removed, manufacturing sales volumes rose 2.5% in November.

Transportation equipment, petroleum and coal product, and chemical industries post the largest gains

Sales of transportation equipment increased 9.1% to $10.6 billion in November, following two consecutive monthly decreases. Most of the increase in November was attributable to higher sales in the motor vehicle assembly (+14.2%) and motor vehicle parts (+11.3%) industries, reflecting increased production after motor vehicle assembly plant shutdowns in October. In constant dollars, sales volumes rose 14.7% in the motor vehicle assembly industry and 10.9% in the motor vehicle parts industry in November.

In the petroleum and coal product industry, sales rose for the fifth straight month, up 6.1% to $6.0 billion in November, primarily due to higher prices. After removing the effect of price changes, sales volumes decreased 0.3% in November.

Chemical industry sales rose 5.9% to $4.4 billion in November, after declining 2.7% in the previous month. The increases in this industry were widespread and were most pronounced in the basic chemical industry, as well as in the pharmaceutical and medicine industry.

Sales also increased in the food (+2.1%), fabricated metal product (+3.0%) and paper (+2.8%) industries.

Higher sales in current dollars were partially offset by decreases in the computer and electronic product (-2.5%) and machinery (-0.6%) industries.

Sales gains concentrated in Ontario

Sales were up in nine provinces in November, with most of the gain in Ontario.

Following two consecutive months of declines, sales in Ontario increased 5.8% in November to $25.4 billion. Higher sales in the transportation equipment industry (+12.7%) were responsible for two-thirds of the provincial increase. Sales were also up in the petroleum and coal product (+14.9%) and chemical (+8.6%) industries. A 1.7% decline in the machinery industry offset some of these gains.

In Quebec, sales rose 1.2% to $13.4 billion, following a 0.4% decline in October. Sales were up in 9 of 21 industries, led by the petroleum and coal product (+8.5%), primary metal (+3.3%) and food (+1.7%) industries. These gains were partly offset by lower sales in the aerospace product and parts (-4.5%) and machinery (-3.8%) industries.

The lone provincial decrease was in Manitoba, where sales were down 1.0% to $1.5 billion in November. This was the second consecutive monthly decline and was largely due to lower sales of durable goods. However, sales for January to November were 4.9% higher compared with the same period in 2016.

Inventory levels increase

Inventory levels rose for the second consecutive month, up 0.9% to $75.4 billion in November. Inventories were up in 12 of 21 industries, led by the transportation equipment (+1.6%) and petroleum and coal product (+4.4%) industries.

Chart 2  Chart 2: Inventory levels increased
Inventory levels increased

The inventory-to-sales ratio fell from 1.39 in October to 1.36 in November, because the increase in sales was much larger than the increase of the inventories. The inventory-to-sales ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.

Chart 3  Chart 3: The inventory-to-sales ratio declines
The inventory-to-sales ratio declines

Unfilled orders decline

Unfilled orders declined 0.9% to $86.4 billion in November. The decrease was mainly attributable to lower unfilled orders in the aerospace product and parts industry, as well as the fabricated metal product industry.

These declines were partially offset by an increase in unfilled orders in the electrical equipment, appliance and component industry, as well as the paper industry.

Chart 4  Chart 4: Unfilled orders decline
Unfilled orders decline

New orders fell 1.8% to $54.7 billion in November, following a 5.2% gain the previous month. The decrease mostly reflected lower new orders in the aerospace product and parts industry. The decline in November was partially offset by higher new orders in the motor vehicle and petroleum and coal product industries.




  Note to readers

Monthly data in this release are seasonally adjusted and are expressed in current dollars unless otherwise specified. For information on seasonal adjustment, see Seasonally adjusted data – Frequently asked questions.

For information on trend-cycle data, see Trend-cycle estimates – Frequently asked questions.

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.

Production-based industries

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 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 (noon spot rate) established by the Bank of Canada is used for the conversion. The monthly average exchange rate is available in CANSIM table 176-0081. Inventories and unfilled orders are reported at the end of the reference period. For most respondents, the noon spot 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 day of the month. In these instances, the noon spot exchange rate on the day selected by the respondent is used. Note that because of exchange rate fluctuations, the noon spot 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. Noon spot exchange rate data are available in CANSIM table 176-0080.

Revision policy

Each month, the Monthly Survey of Manufacturing releases preliminary data for the reference month and revised data for the three previous months. Revisions are made to reflect new information provided by respondents and updates to administrative data.

Real-time CANSIM tables

Real-time CANSIM tables 304-8014, 304-8015 and 377-8009 will be updated on January 29, 2018. For more information, consult the document Real-time CANSIM tables.

Next release

Data from the Monthly Survey of Manufacturing for December 2017 will be released on February 16, 2018.

Contact information

For more information, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).

For more information, or to enquire about the concepts, methods or data quality of this release, contact Bechir Oueriemmi (613-951-7938; bechir.oueriemmi@canada.ca) or Michael Schimpf (613-863-4480; michael.schimpf@canada.ca), Manufacturing and Wholesale Trade Division.

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