OTTAWA, Ont. — Rising prices in the refined petroleum and coal products industry led to a modest 0.3 percent increase in overall manufacturing shipments in November, the latest Statistics Canada numbers indicate, but unfortunately that’s no indication freight volumes are ready to perk up once again.
When the increase in refined petroleum and coal products is excluded, shipments were virtually unchanged from October. The pace of growth in manufacturers’ shipments continued to soften in November, as companies shipped $45.7 billion in goods.
As noted, the growth was led by the refined petroleum and coal products industry which saw shipments rise 4.3 percent to $3.1 billion in November as suppliers took advantage of higher prices. Shipments in the fabricated metal products industry also showed growth, climbing 3.2 percent to $2.4 billion, their highest level since March 2000. The November increase occurred largely in the fabricated structural metal products and the other metal fabricating products segments.
Overall, shipments increased in 16 of the 22 major groups, representing 51 percent of total shipments.
However, there were also marked declines in shipment volumes in several industries key to truck freight. Total shipments in the automotive sector declined 1.6 percent to $8.5 billion. Parts and accessories accounted for the entire decrease; manufacturers increased their shipments of new vehicles.
In recent months, higher retail inventories and lower-than-expected demand have had less and less effect on the automotive sector, according to Statistics Canada. A number of motor vehicle manufacturers have announced their intention to curtail production at motor vehicle assembly plants by closing some plants temporarily, shortening employee work weeks and eliminating overtime.
“As a result, automotive manufacturers have reduced orders to the motor vehicle parts and accessories industry. In November, this resulted in a 6.7 percent decrease in shipments of parts and accessories to $2.6 billion, the lowest level since September 1998,” Statistics Canada reported in its Daily Bulletin. “However, shipments of new motor vehicles rose 0.9 percent in November, as manufacturers reduced finished product inventories by 14.4 percent.”
The second largest decrease among the major manufacturers was experienced in the electrical and electronic products industry, which shipped $4.3 billion worth of goods, a 1.2 percent decline.
The inventory-to-shipments ratio increased to 1.35 in November from 1.34 in October. The inventory-to-shipments ratio has continued to edge up in recent months, and the trend in the ratio has also increased steadily since February 2000. The finished products-to-shipments ratio has remained stable.