Canada’s manufacturing sector saw its third consecutive monthly sales decline in July 2022, according to the country’s national statistical office.
Statistics Canada reported a slip of 0.9 per cent to $71.6 billion in manufacturing market activity, with lower sales in 12 of 21 industries, led by the primary metal (-9.9 per cent), petroleum and coal product (-5.3 per cent), and furniture and related products (-11.2 per cent) industries.
Meanwhile, food sales, motor vehicle parts, and paper products industries showed the most increase, standing at 2.5 per cent, 10.7 per cent, and 8.1 per cent, respectively.
The StatCan report also noted that sales in constant dollars increased 0.6 per cent in July, the second consecutive monthly increase, while the Industrial Product Price Index declined 2.1 per cent for the month.
Total inventory levels saw an uptick of 1.2 per cent in July, with a total valuation of $118.1 billion.
Record-high inventory levels were also seen in 14 to 21 industries, led by the primary metal (+2.3 per cent), machinery (+2.1 per cent), and petroleum and coal (+2.4 per cent) industries.
However, the gains were partially offset by a 1.4 per cent decline in inventories of chemical products.
“Higher prices of materials have been the main contributor to the increase in inventory levels since the beginning of the COVID-19 pandemic,” StatCan said in a statement.
Total inventories skyrocketed by a staggering 35.3 per cent in current dollars while raw materials rose 48.2 per cent in July, compared with the pre-pandemic level in February 2020, while they were up only 6.9 per cent and 10 per cent in real terms during the same period.
“The inventory-to-sales ratio increased from 1.61 in June to 1.65 in July. This ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.”
