| Consensus | Consensus Range | Actual | Previous | Revised | |
|---|---|---|---|---|---|
| Month over Month | -1.5% | -1.5% to -1.5% | -1.3% | 1.4% | 1.1% |
| Year over Year | -4.4% | -1.1% |
Highlights
Manufacturing sales retreated by 1.3 percent in August from July, slightly better than expectations for a 1.5 percent decline. Real sales increased 0.8 percent on the month. In year-over-year terms, nominal sales plunged 4.4 percent and declined a bigger 5.1 percent in real terms.
Looking ahead, indicators continue to be bleak as new orders dropped 2.4 percent on the month and unfilled orders fell 0.8 percent.
Inventories declined 0.6 percent, and the inventory-to-sales ratio was rose to 1.75 in August from 1.74 in July and versus 1.67 a year ago.
The unadjusted capacity utilization rate rose to 79.6 percent in August from a revised 78.6 percent in July and versus 79.9 percent in August a year ago.
Manufacturing sales contracted in eight provinces in August, primarily in Alberta (-3.3 percent) and Ontario (-0.6 percent). Sales in Prince Edward Island were up the most (+2.3 percent).
The decline in August meant manufacturing sales came in at their lowest level since January 2022, mainly due to lower sales in the primary metal (-6.4 percent) as well as petroleum and coal product (-3.7 percent) subsectors.
Within primary metals, the decline was primarily due to lower sales of non-ferrous metals (except aluminum), and partially due to their lower prices (-1.7 percent) in August."Weaker domestic and international demand for metals due to lower construction and manufacturing activities have pulled the prices of many primary metals lower in the past few months," StatsCan said.
Within the petroleum subsectors, the cost of refined petroleum energy products (including liquid biofuels) dove 5.8 percent in August,"partly due to increasing concerns over global economic growth and demand, particularly in China." On an annual basis, total sales of petroleum and coal products fell 7.9 percent in August.
Aerospace products and parts production rose 7.3 percent in August to their second highest level on record and was up 23.6 percent from the same month a year ago. Wood product sales rose 3.8%, with the prices of lumber and other wood products up 2.1 percent in August.
Looking ahead, indicators continue to be bleak as new orders dropped 2.4 percent on the month and unfilled orders fell 0.8 percent.
Inventories declined 0.6 percent, and the inventory-to-sales ratio was rose to 1.75 in August from 1.74 in July and versus 1.67 a year ago.
The unadjusted capacity utilization rate rose to 79.6 percent in August from a revised 78.6 percent in July and versus 79.9 percent in August a year ago.
Manufacturing sales contracted in eight provinces in August, primarily in Alberta (-3.3 percent) and Ontario (-0.6 percent). Sales in Prince Edward Island were up the most (+2.3 percent).
The decline in August meant manufacturing sales came in at their lowest level since January 2022, mainly due to lower sales in the primary metal (-6.4 percent) as well as petroleum and coal product (-3.7 percent) subsectors.
Within primary metals, the decline was primarily due to lower sales of non-ferrous metals (except aluminum), and partially due to their lower prices (-1.7 percent) in August."Weaker domestic and international demand for metals due to lower construction and manufacturing activities have pulled the prices of many primary metals lower in the past few months," StatsCan said.
Within the petroleum subsectors, the cost of refined petroleum energy products (including liquid biofuels) dove 5.8 percent in August,"partly due to increasing concerns over global economic growth and demand, particularly in China." On an annual basis, total sales of petroleum and coal products fell 7.9 percent in August.
Aerospace products and parts production rose 7.3 percent in August to their second highest level on record and was up 23.6 percent from the same month a year ago. Wood product sales rose 3.8%, with the prices of lumber and other wood products up 2.1 percent in August.
Market Consensus Before Announcement
Manufacturing sales expected to fall 1.5 percent, in line with the Stats Can preliminary estimate, after rising 1.4 percent in July.
Definition
Manufacturing sales for twenty-one reporting industries are the Canadian dollar level of factory shipments for manufacturing durable and nondurable goods. Volume figures are also provided. The sales statistics form part of a wide monthly report that encompasses information on new orders, backlogs and inventories and is a key input into forecasts of monthly gross domestic product (GDP).
Description
Manufacturer's shipments represent the monetary level of factory shipments for durable and nondurable goods and are a relevant indicator for an export-oriented economy. The data are used by analysts to evaluate the economic health of manufacturing industries. They are also used as inputs to GDP and needless to say, these data are used by the central bank in its decision-making process.
The monthly survey of manufacturing of which shipments is a part, provides a broad look at manufacturing activity levels. The level of activity in manufacturing can be affected by the level of interest rates which slows or stimulates the demand for goods and production. Shipments are an indication of how busy factories have been as manufacturers work to fill orders. The data not only provide insight to demand for items such as refrigerators and cars, but also business investment such as industrial machinery, electrical machinery and computers. Because a large proportion of shipments are headed south of the border to the U.S. and include a wide variety of durables, shipments are affected by U.S. economic activity as well as the exchange rate. Although the focus in this report is on shipments, it also contains information on inventories and new and unfilled orders.
Results from this survey are used by both the private and public sectors including finance departments of the federal and provincial governments, the Bank of Canada, Industry Canada, the System of National Accounts, the manufacturing community, consultants and research organizations in Canada, the United States and abroad.
The monthly survey of manufacturing of which shipments is a part, provides a broad look at manufacturing activity levels. The level of activity in manufacturing can be affected by the level of interest rates which slows or stimulates the demand for goods and production. Shipments are an indication of how busy factories have been as manufacturers work to fill orders. The data not only provide insight to demand for items such as refrigerators and cars, but also business investment such as industrial machinery, electrical machinery and computers. Because a large proportion of shipments are headed south of the border to the U.S. and include a wide variety of durables, shipments are affected by U.S. economic activity as well as the exchange rate. Although the focus in this report is on shipments, it also contains information on inventories and new and unfilled orders.
Results from this survey are used by both the private and public sectors including finance departments of the federal and provincial governments, the Bank of Canada, Industry Canada, the System of National Accounts, the manufacturing community, consultants and research organizations in Canada, the United States and abroad.
