According to Statistics Canada, following a 1.1 percent decline in May, manufacturing sales fell 0.8 percent to $71.8 billion in June, on lower sales in 8 of 21 industries, led by the petroleum and coal product (-7.8 percent), wood product (-7.2 percent) and aerospace product and parts (-16.8 percent) industries. Meanwhile, sales of motor vehicles (+13.8 percent) and chemical products (+6.0 percent) increased the most.
Total inventory levels increased 2.1 percent to $116.4 billion in June, mainly on higher inventories in the machinery (+4.3 percent), transportation equipment (+2.5 percent) and chemical (+3.5 percent) product industries. Meanwhile, the miscellaneous industry (-3.5 percent) posted the largest decline in inventory levels in June. Raw materials, representing the largest component of inventories, have been trending upward for 20 consecutive months due to higher prices. Year over year, total inventories rose 27.7 percent.
The inventory-to-sales ratio increased from 1.57 in May to 1.62 in June. This ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.
The total value of unfilled orders rose 1.7 percent to $105.0 billion in June. The increases were mainly attributable to higher unfilled orders in the motor vehicle (+87.5 percent), aerospace product and parts (+1.4 percent), and computer and electronic (+3.7 percent) product industries. Total unfilled orders were up 19.1 percent on a year-over-year basis in June.
The total value of new orders increased 2.7 percent to $73.6 billion in June, largely due to higher new orders of aerospace product and parts, motor vehicles, and chemical products.
The capacity utilization rate (not seasonally adjusted) for the total manufacturing sector increased from 78.8 percent in May to 79.3 percent in June due to higher production.
The capacity utilization rates rose in 10 of 21 industries in June and was noticeable in the transportation equipment (+7.2 percentage points), computer and electronic (+4.1 percentage points), and fabricated metal (+2.9 percentage points) product industries. The gains were partially offset by a lower capacity utilization rate in the petroleum and coal (-3.0 percentage points) and wood (-1.3 percentage points) product industries.