OTTAWA, Ont. — Manufacturers’ total inventories contracted for a third consecutive month, down by 0.7% in October, Statistics Canada records reveal.

The reported value of inventories dropped $449 million to $65.3 billion. The decrease in October was largely due to a 1.8% decrease in finished goods.

Inventory levels started to trend downwards more noticeably in recent months after peaking in July 2006. Prior to the autumn of 2006, inventory levels had increased from 2004 to the summer of 2006.

Aerospace products and parts led the inventory decreases, reporting a drop of 4.8% to $4.4 billion. This was the second month of decreased inventories as manufacturers within the industry have reported three months of rising production.
The other industry reporting a sizeable decline in inventories was petroleum and coal product manufacturers. Inventories decreased 2.6% to $3.6 billion for the fifth drop in last six months.

Food products manufacturers were one of the few industries reporting a sizeable build-up of inventories. Levels rose 2.1% to $5.5 billion for the fifth gain in the past seven months.