Canada: Wholesale Trade, August 2017

Wholesale sales rose 0.5% to $62.8 billion in August, led by the personal and household goods and motor vehicle and parts subsectors.

Sales were up in four of the seven subsectors, together representing 47% of total wholesale sales.

In volume terms, wholesale sales rose 0.4%.

Gains mainly attributable to the personal and household goods and the motor vehicle and parts subsectors

Sales in the personal and household goods subsector rose for the ninth consecutive month—posting the largest gain in dollar terms in August, rising 3.3% to a record $9.0 billion. Sales were up in four of the six industries, with the textile, clothing and footwear industry contributing the most to the gain.

Sales in the motor vehicle and parts subsector increased for the third time in four months, up 2.0% to $11.8 billion. The growth in the subsector was attributable to higher sales in the motor vehicle industry, which recorded its second consecutive monthly gain. There were higher imports of passenger cars and light trucks in August, and motor vehicle manufacturing sales increased.

Following two months of declines, the miscellaneous subsector rebounded in August, up 1.6% to $8.1 billion. Sales were up in four of the five industries, led by the recyclable material industry.

The building materials and supplies subsector posted the largest decline in August, down 3.5% to $8.7 billion and its first decrease in six months. Two of the three industries declined in August, with the lumber, millwork, hardware and other building supplies industry contributing the most to the downward movement.

Sales increase in five provinces, led by Ontario, Quebec, and British Columbia

In Ontario, wholesale sales rose 0.8% to $32.1 billion, on the strength of higher sales in the personal and household goods (+6.4%) and the motor vehicle and parts (+0.6%) subsectors. The gain was slightly offset by lower sales in the machinery, equipment and supplies subsector (-1.6%).

Wholesale sales in Quebec increased for the fifth time in six months, up 1.0% to $11.3 billion in August. Four of the seven subsectors reported higher sales, led by the motor vehicle and parts (+5.8%) and the food, beverage, and tobacco (+2.5%) subsectors.

In British Columbia, sales were up 0.7% to $6.7 billion. Sales increased in five of the seven subsectors, with the machinery, equipment supplies (+7.6%) and the miscellaneous (+10.8%) subsectors leading the gain.

Wholesale sales in Alberta (-2.0%) fell in five of the seven subsectors. The food, beverage and tobacco (-5.1%) and the machinery, equipment and supplies (-3.9%) subsectors contributed the most to the decline.

Inventories up for the fifth consecutive month

Wholesale inventories climbed for the fifth consecutive month, up 0.2% to a record $80.8 billion in August. Increases were recorded in three of the seven subsectors, representing 45% of total wholesale inventories.

Inventories in the building material and supplies subsector rose 1.7% in August, accounting for the largest gain in dollar terms of all subsectors. The building material and supplies subsector has posted the highest level of growth of all subsectors in 2017, increasing 8.9% from January.

Inventories rose 1.1% in the personal and household goods subsector, a fourth increase in five months. Inventories have grown by 7.6% over this five-month period, led by the textile, clothing and footwear industry.

The food, beverage and tobacco subsector (+1.5%) posted a sixth consecutive monthly increase, on the strength of higher inventories in the food industry (+1.5%).

The miscellaneous subsector (-2.5%) reported the largest dollar value decline in August, with the agricultural supplies industry (-4.5%) leading the decrease. Despite the decline in August, inventories in the miscellaneous subsector were 18.8% higher than in August 2016.

The inventory-to-sales ratio remained constant at 1.29 from July to August, an indication that both inventories and sales have been increasing at the same pace. This ratio is a measure of the time in months required to exhaust inventories if sales were to remain at their current level.

StatsCanada

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell