Canada Wholesale Sales Fell 1.8% in October

(Bloomberg – Alexandre Deslongchamps)

Canadian wholesale sales fell more than three times as much as expected in October as demand for recyclable metals and cars slowed.

Sales dropped 1.8%, the most since February, to C$45.3 billion ($37.5 billion), Statistics Canada said today in Ottawa. Economists surveyed by Bloomberg said sales would fall 0.5%, the median of 13 estimates, after a 1.1% gain in September.

The sales decline was led by a 6.9% drop in sales of cars and trucks and an 8% plunge in the “other products” category, its biggest since March 2001, caused by lower demand and prices for recyclable metals. Car and truck sales were 14% below a year ago, the agency said.

Excluding autos, wholesale sales fell 1.2%, with four of seven industry components tracked by the statistics agency recording a decline. Inventories rose for an eighth straight month, gaining 0.8%.

Excluding price changes, sales tumbled 3.6% in October, Statistics Canada also said. The Canadian dollar depreciated during the month and boosted the cost of imported goods, the agency said to explain the discrepancy.

Summary statistics and a link to the data files are on the Statistics Canada website.

Wholesale Trade: July

(Statistics Canada)

Wholesale sales rose 2.3% in July to $46.2 billion as increases across a number of sectors contributed to a fifth consecutive monthly gain. Price effects were minimal in July, as sales in volume terms rose 2.2%.

July’s gains were spread across six of the seven wholesale sectors, with food, beverages and tobacco products the only sector reporting lower sales.

The largest contribution came from the "other products" sector, which rebounded from a 3.4% drop in June to post a 6.0% rise in July. Sales in this sector have increased significantly over the past year, mostly as a result of higher global demand for agricultural supplies. Exports of fertilizers and fertilizer material rose by more than 30% in July and have more than doubled over the past year.

The building materials sector also made a significant contribution (+4.8%) to July’s increase, as all three components of this sector reported higher sales. Wholesalers of metal products registered the largest increase, gaining 10.8% in July after a 7.9% rise in June. The value of metal products sales has risen sharply since the end of 2007, mostly due to higher world prices.
The other increase (+3.1%) of note was observed in the machinery and electronic equipment sector and was largely the result of higher sales (+5.1%) in the machinery and equipment trade group, which accounts for half of all sales in this sector. This was the seventh consecutive rise for this trade group, which in recent months has benefited from strong demand for agricultural machinery as well as sales to the oil and gas sector.

Overall, six provinces reported higher sales in July. Summary statistics and a link to the data set are on the Statistics Canada website.

Study: The Year in Review for Wholesale Trade, 2007

(Statistics Canada)

The wholesale trade sector expanded for a fourth consecutive year in 2007.Wholesale sales amounted to $517.8 billion in 2007, up 5.5% from 2006, a slightly faster pace than the growth the year before. It was the fourth year in a row that the rate of growth surpassed 5.0%, according to a year-end review published today in the Analysis in Brief series.

Provincially, the rate of growth accelerated in Saskatchewan, Newfoundland and Labrador, and Manitoba. Sales in Saskatchewan rose 19.6%, the fastest rate of growth since the start of this statistical series in 1993 and the best performance among the provinces.

Alberta wholesalers had a growth rate below the national average for the first time since 2002.

While slightly higher than 2006 levels, the rate of growth for wholesalers in Ontario was below the national average for the fifth consecutive year. As a result, Ontario’s share of national sales continued to slide, although it still represented just over half of the total.

Quebec wholesalers experienced a slight recovery in 2007, with the pharmaceuticals trade group still the main source of growth.

Nationally, this performance in 2007 was due, among other factors, to the “other products” sector, which posted the strongest growth in wholesale trade and had its best performance since 2003. Sales in this sector grew partly because of increased sales of agricultural chemicals and other farm supplies, as well as sales of animal feed.

This study reviews the performance of the wholesale trade sector nationally and regionally, along with some of the key factors affecting last year’s performance. The report is available on Statistics Canada website.