Statistics Canada announces that in February, lower prices for several resource-based industries contributed to a sizeable drop in manufacturing shipments and a spike in the inventory-to-shipment ratio.
Shipments tumbled 2.2 percent to $50.7 billion in February, the third decline in the last four months. Although wide ranging, the decrease was largely attributable to lower industrial prices for petroleum, wood and chemical products.
Consequently, the sharp drop in shipments boosted the inventory-to-shipment ratio to 1.31 from 1.27 in January. In recent months, the volatility of shipments has caused the ratio to vary more than usual. February's ratio is equal to that of the recent high set in July 2005.
The inventory-to-shipment ratio is a key measure of the time, in months that would be required to exhaust inventories if shipments were to remain at their current level.
Manufacturing activity pulls back in most industries Accounting for 64 percent of total shipments, 16 of the 21 industries posted decreases in February.
A Shipments of wood products fell 7.3 percent to $2.8 billion, giving back most of the gains posted in January (+3.5 percent) and December (+4.6 percent), a period of rising prices for lumber products.
Most provinces post lower shipments in February Only Newfoundland and Labrador, the Northwest Territories and Nunavut registered higher shipments in February. Lower shipments by nondurable goods industries largely contributed to the weak month for most provinces.
marketing@alchempro.com
