Monthly Survey of Manufacturing, July 2019
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Released: 2019-09-17
Manufacturing sales decreased 1.3% to $57.2 billion in July, following a 1.4% decline in June.
Sales were down in 11 industries in July, representing 66.8% of total manufacturing sales. The decline in July was mainly due to lower sales in the primary metal and motor vehicle industries. The food industry posted the largest gain.
Manufacturing sales in constant dollars were down 1.6% in July, indicating that a lower volume of manufacturing products was sold.
Chart 1
Manufacturing sales
Sales down in the primary metal industry
Sales in the primary metal industry fell 7.3% in July following a 10.6% increase in June. In constant dollars, sales of primary metals were down 7.0%. Every primary metal industry except alumina and aluminum production and processing reported lower sales. In particular, sales of iron and steel mills and ferro-alloy products decreased 14.8% due to lower quantities sold and maintenance shutdowns at some plants.
Sales of motor vehicles decreased 4.7% in July, the second consecutive monthly decline. The decrease in motor vehicle sales was partially the result of an extended shutdown at a major assembly plant attributable to maintenance projects to support new model production. Sales of motor vehicles were nevertheless 1.0% higher than in July 2018.
Sales were also down in the fabricated metal product (-3.2%), railroad rolling stock (-26.7%), and computer and electronic product (-6.0%) industries.
Sales in the food industry increased 1.3% in July after two consecutive monthly declines. In volume terms, sales rose 1.9%. The growth in food manufacturing reflected higher sales of meat products in Quebec, Alberta and Ontario. The seafood industry posted an unadjusted sales decline, which is expected as fishing season is ending.
Ontario posts the largest decrease
Sales were down in five provinces in July, led by Ontario and Alberta. Nova Scotia reported the largest gain.
Following two consecutive monthly gains, sales in Ontario fell 1.5% to $26.5 billion in July. The decline stemmed from lower sales of primary metals (-13.4%) and motor vehicles (-4.7%).
In Alberta, sales were down 2.8% to $6.3 billion, following a 7.0% decrease in June. In July, 15 of 21 manufacturing industries reported lower sales in Alberta, led by the petroleum and coal product industry (-5.0%).
Manufacturing sales in Quebec declined 1.2% to $14.2 billion in July. The decrease was attributable to lower sales in the transportation equipment (-5.3%) and primary metals (-4.0%) industries.
Sales in Nova Scotia rose 5.4% to $801 million as a result of gains in the paper, food and transportation equipment industries.
Manufacturing sales now available by select census metropolitan area
With this release, Statistics Canada is publishing manufacturing sales data for 12 census metropolitan areas (CMAs) for the first time. The data cover the period from January 2009 to July 2019. More information can be found under the "Related information" tab of the Monthly Survey of Manufacturing release. The local manufacturing data are not seasonally adjusted.
In July, sales declined 7.6% (unadjusted) in Toronto to $9.9 billion, largely reflecting lower motor vehicle sales. Motor vehicle manufacturers typically shut down for a portion of the month to undertake maintenance work.
Montréal's manufacturing sector was down 3.1% (unadjusted) to $6.4 billion in July. The decline reflected lower production in the aerospace product and parts industry. In contrast to Montréal, sales in the CMA of Québec rose 1.7%.
Manufacturing sales in Edmonton were down 0.3% to $3.3 billion on an unadjusted basis while sales in Calgary rose 4.5% to $1.1 billion.
Inventory levels rise again following a decline in June
Total manufacturing inventories rose 0.3% to $88.3 billion in July, following a 1.3% decline in June. Inventory levels have been on an upward trend since January 2017, decreasing four times over that period.
Inventories were up in 12 of 21 industries in July, led by the transportation equipment (+2.1%) and chemical (+1.7%) industries. The gains were partly offset by a 2.3% decrease in fabricated metal products inventory.
Chart 2
Inventory levels increase
The inventory-to-sales ratio rose from 1.52 in June to 1.54 in July, due to lower sales and higher inventories. This ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.
Chart 3
The inventory-to-sales ratio increases
Unfilled orders decline
Unfilled orders fell 1.4% to $98.1 billion in July as a result of lower unfilled orders in the transportation equipment (-1.4%) and the fabricated metal product (-5.6%) industries. Unfilled orders rose in the chemical (+27.3%) and computer and electronic product (+1.4%) industries.
Chart 4
Unfilled orders decline
Following a 4.4% decrease in June, new orders fell 1.6% to $55.8 billion in July as a result of lower new orders in the transportation equipment (-5.5%) and fabricated metal product (-14.9%) industries.
Capacity utilization rate declines
The capacity utilization rate (not seasonally adjusted) for the total manufacturing sector declined 4.0 percentage points, from 81.3% in June to 77.3% in July. Overall, 16 of 21 industries posted a lower capacity utilization rate in July.
Chart 5
The capacity utilization rate declines
In the transportation equipment industry, the capacity utilization rate fell 16.6 percentage points, mainly because of shutdowns in July. Despite the widespread declines, the capacity utilization rate rose 2.6 percentage points in the petroleum and coal industry, mainly on the strength of increased refinery production, following three consecutive declines from April to June 2019.
Sustainable Development Goals
On January 1, 2016, the world officially began implementation of the 2030 Agenda for Sustainable Development—the United Nation's transformative plan of action that addresses urgent global challenges over the next 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 Goals for Sustainable Development. This release will be used in helping to measure the following goal:
Note to readers
Starting with the September 2019 release of July data, unadjusted sales estimates for 12 selected census metropolitan areas (CMAs) are produced for the first time as part of the Monthly Survey of Manufacturing. A Small Area Estimation (SAE) methodology was used to compile the sub-provincial estimates, using Goods and Services Tax data provided by the Canada Revenue Agency.
For information on Small Area Estimation methodology, see Small Area Estimation for the Monthly Survey or Manufacturing.
The unadjusted estimates of sales of goods manufactured for the 12 CMAs covers the 21 three-digit manufacturing industries of the North American Industry Classification System (NAICS) and the seven four-digit level industries within the transportation equipment industry. The data have been compiled from January 2009 to July 2019 and are available in table 16-10-0011-01.
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 given 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 if 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, which are assumed to occur throughout the month, the average 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 day of the month. In such cases, the daily average exchange rate on the day selected by the respondent is used. As a result 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.
Revision policy
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, multiple years of data are revised.
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 September 26.
Next release
Data from the Monthly Survey of Manufacturing for August will be released on October 17.
Contact information
For more information, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca).
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), Mining, Manufacturing and Wholesale Trade Division.
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