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INDUSTRY PULSE: Demand for foreign machinery and equipment import continues

OTTAWA, Ont. -- The growth in imports in March was widespread as six of the seven import sectors registered gains.

OTTAWA, Ont. — The growth in imports in March was widespread as six of the seven import sectors registered gains.

Imports of machinery and equipment recorded 2.9% growth in March, reaching $9.4 billion. Inbound shipments of aircrafts, engines and parts were the driving force, rising 20.3% as airlines continued their fleet expansion activities, Statistics Canada records indicate.

Within industrial machinery, imports of engines, turbines and motors registered their fifth consecutive gain in March and increases were also recorded for excavating machinery, drilling and mining machinery and other industrial machinery.

Energy imports rose 14.3% to $2.9 billion as a surge in demand from Eastern Canadian refineries fuelled an 18.0% increase in inbound shipments of crude petroleum to $2.0 billion. The increase was volume-based as import prices for crude petroleum were stable in March. This differs from the decline in crude export prices as Eastern Canadian refineries import sweet, light crude while Western Canadian crude producers export primarily heavy, sour crude. Sweet, light crude tends to be higher-priced and register greater price gains in the market than heavy, sour crude petroleum. Refineries had imported a sizeable volume of crude petroleum in November 2005 but volumes had dropped considerably in the months following until this growth in March.

Also contributing to the growth in energy products were advancing imports of coal and refined petroleum, up 9.3% and 4.9%, respectively. A rebound from February’s price decline accounts for the rise in import values of refined petroleum.

Imports of industrial goods and materials jumped 3.8% to $6.9 billion following a decline in February. Inbound shipments of metals and metal ores climbed 11.8% to $2.2 billion as imports of precious metals rebounded from February’s decline. While a 51.0% increase in volumes accounted for the vast majority of the jump in precious metal import values, the continued rise in prices of precious metals since the end of 2005 also contributed to the increase. Chemicals and plastics also registered gains, rising 2.0% to $2.5 billion.

Imports of automotive products rose 1.6% in March to $6.5 billion. Growth in inbound shipments of trucks and other motor vehicles (+11.4%), along with passenger autos and chassis (+1.8%) more than offset a 2.3% decline of incoming motor vehicle parts. Canadian demand for trucks, large for industrial use and smaller for personal use, has been thriving, leading to imports of over $1.0 billion each month since October 2003.

Imports of other consumer goods rose 2.4% to $4.3 billion in March driven by inbound shipments of pharmaceutical products from the United States. Meanwhile, imports of agricultural and fishing products edged up to $1.9 billion while forestry products edged down to $248.0 million.

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