After falling 1.2% in July, manufacturing sales were up 0.5% in August, as sales of petroleum and chemical products jumped to record high levels.
According to Statistics Canada, manufacturing sales across Canada were up 14.9% year-over-year to $60.3 billion in August, largely due to higher sales volume. The Industrial Product Price Index slumped 0.3% from July, and the Raw Materials Price Index was down 2.4%, marking the first decline since September 2020.
Sales of Petroleum products were up for the third straight month in August, rising 7.3% to $6.6 billion— the highest since May 2019. Refined petroleum product exports increased 5.6%, amid higher demand from the US. Chemical sales soared 6.3% from July to a record-high of $5.4 billion, as did sales of primary metals, which were up 3.3% to a new high of $5.8 billion. Compared to the same period one year ago, primary metal product sales have rebounded 55.2%.
Wood products, on the other hand, were down 17.1% to $3.3 billion in August, largely due to lower softwood lumber prices. In constant dollars, sales were up 3.7%, as prices for lumber and other wood products slumped 14.2%. Similarly, motor vehicle sales declined 8.7% to $3 billion in August following what were three consecutive months of gains, as the global semiconductor shortage continues to weigh down on automakers.
Meanwhile, total inventories rose 2.1% to a record-high of $96.2 billion, largely driven by higher prices of raw materials over the past 12 months. This caused the inventory-to-sales ratio— which measures the amount of months it would take to exhaust all inventories— to increase from 1.57 to 1.59 in August.
Information for this briefing was found via Statistics Canada. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.