OTTAWA, Ont. — Manufacturing shipments continued to climb in July, to a record high of $50.2 billion, up 0.5% from June, according to the latest report from Statistics Canada.

"July marked the eighth consecutive increase in shipments, the longest string of gains since the late 1990s," the government agency noted in its report. There was a note of caution provided in the report as well, however. Although manufacturing shipments have increased by 11.7% over the last eight months, the pace has slowed in recent months. Shipments edged up 0.5% in Julythe smallest gain since January.

The momentum in the manufacturing sector has pushed capacity utilization to its highest level in four years, reaching 86.6% in the second quarter of 2004. July’s increase in shipments was in 12 of 21 industries, accounting for a healthy 80.7% of total shipments. Non-durable goods shipments increased 1.2% while durable goods manufacturing declined 0.1% to $28.5 billion in July. Foreign and domestic demand for natural resource based products (wood, petroleum and primary metals) also contributed to shipment gains.

Quebec, British Columbia, Alberta and Saskatchewan led the way, reporting solid gains in shipments in July. Shipments in Quebec continued to surge ahead, gaining ground for the seventh time in eight months. Petroleum and wood product manufacturing contributed to a $159 million (+1.4%) increase in shipments to $11.8 billion. Shipments are hovering just below the peak levels of late 2000.

Shipments in Alberta also continued to rise, increasing for the 11th time in 12 months. July’s shipments rose by $57 million (+1.3%) to $4.5 billion, on the strength of the chemical products and primary metals industries. Year-to-date shipments in Alberta are 10.6% above the same period in 2003.

British Columbia also posted a positive move in July, rebounding from a slight decline in June. Machinery and wood products contributed to a $44 million (+1.2%) increase in shipments to $3.6 billion. The gain added to strength built up in British Columbia this year, marking the sixth increase in shipments in seven months.

Shipments in Saskatchewan increased for the third month in a row, up a strong $24 million (+3.1%) to $815 million. Shipments also increased in Nova Scotia (+0.6%) and New Brunswick (+1.1%) in July.
Manufacturing declined $37 million (-3.5%) in Manitoba. Following five months of growth in Ontario, declines in transportation equipment, fabricated metals and beverages and tobacco products contributed to a $19 million (-0.1%) decrease in shipments. Shipments also declined by $13 million (-5.0%) in Newfoundland and Labrador and $2 million (-1.7%) in Prince Edward Island.

Shipments of non-durable goods continued to climb in July, increasing a solid 1.2%. Non-durable goods were up 7.6% in the first seven months of the year compared with the same period in 2003. Manufacturers of chemical products reported a 2.6% jump in shipments to $3.9 billion. July’s increase marked the sixth consecutive rise in shipments. Food manufacturing increased $82 million to $5.9 billion in July, led by the fruit and vegetable preservation industry. Rounding out solid gains in non-durable goods manufacturing, petroleum products increased by $67 million (+1.7%).

Also contributing to higher shipments in July were railroad rolling stock and wood products. Railroad rolling stock shipments increased by $80 million (+46.2%), as manufacturers stepped up production to meet rising demand for rail cars. Shipments of wood products have risen sharply this year, soaring 20.4% higher than the same period in 2003. Following a slight decline in June, wood shipments continued to climbincreasing $71 million in July. Ongoing demand for wood products remains strong. The value of residential building permits issued in Canada was up 18.3% in the first seven months of the year compared with 2003. The US housing market remains hot and rebuilding efforts from recent hurricanes in Florida have just begun.