INDUSTRY PULSE: Manufacturing shipments decline in November

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OTTAWA, Ont. — Large declines in petroleum prices and continued volatility in the auto sector were the driving forces behind the 1.5% drop in manufacturing shipments ($51.4 billion) in November, Statistics Canada reported this morning.

At 1997 prices, total shipments fell 0.8% to $47.5 billion, as some manufacturers have cut production levels in recent months. This was the third decline in constant dollar shipments in the last five months.

In November, gasoline and fuel oil prices took a dive from record levels as refineries along the US Gulf Coast came back online following extensive production disruptions caused by the 2005 hurricane season.

An 8.7% decline in the price of petroleum and coal products at the factory gate, coupled with production slowdowns due to maintenance at some plants, reduced petroleum shipments by 10.8% to $4.5 billion. Excluding the price-influenced petroleum industry, total manufacturing shipments decreased by a more modest 0.6%.

The majority of provinces and the territories posted higher shipments in November with Alberta (+$68 million) and British Columbia (+$65 million) as the primary movers. Only three provinces reported lower shipments, but the big players were among them, notably Ontario and Quebec, which comprise three-quarters of the total value of Canadian shipments.

Shipments in Ontario dropped by $807 million (-3.0%) to $25.9 billion, due to declines in the motor vehicle and parts industries, as well as petroleum and chemical manufacturing.
Also on the downside in November, shipments in New Brunswick fell by $159 million (-11.7%) to $1.2 billion, while Quebec’s petroleum and chemical products industries contributed to a $98 million (-0.8%) decrease, the first in three months.

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