Manufacturing rebounds after rail strike, fuel crunch

OTTAWA — Manufacturers had a strong March as previous supply disruptions caused by the CN rail strike and the refinery fire in Ontario were rectified.

After a slight increase in factory shipments in February, Stats Canada reports that manufacturers shipped goods worth about $50.1 billion — a 2.8 percent gain over the previous month.

Shipments increased in 15 of 21 manufacturing sectors, representing about 78 percent of total output.

Both durable and non-durable goods saw shipments increase in March. The petroleum and coal products industry continued to heavily influence the direction of non-durable shipments, with a 2.2 percent increase in non-durable goods to $22.4 billion. Durable goods increased 3.3 percent on the back of strong automotive and aerospace production.

The transportation equipment sector surged 7.5 percent to $10.4 billion in March, recovering from the sharp loss recorded in January. The strongest increase was a 13.4 percent jump in production of aerospace products and parts. Other than a 13 percent drop in January, shipments have increased in four of the past five months.

Motor vehicle shipments also did well, jumping up by 7.2 percent while shipments of parts gained 4.3 percent.

The rebound in those sectors bode well for Quebec and Ontario, as total shipments in the latter province went up 3.6 percent to $24.4 billion in March, the first increase since December.

Manitoba’s manufacturers also posted a very strong month as shipments jumped 11.5 percent to $1.4 billion thanks to robust demand and rising prices in the primary metals industry.

Overall, eight provinces posted higher shipments in March.

Unfilled orders, an indication of future
shipments, remains highest since 2001

Other areas posting notable increases in shipments included the petroleum and coal product sector (+9.3%) and the primary metal sector (+2.3%). However, price was a factor for both of these industries.

New Orders Ease Back; Unfilled Orders Still High:

New orders decreased 1.4 percent to $50.2 billion, falling slightly from the recent high of $51.0 billion in December. Despite the decline, new orders remained strong in the first quarter of 2007, increasing by 1.7 percent compared to the final quarter of 2006.

Meanwhile, unfilled factory orders, an indicator of probable future shipments, remained virtually unchanged from February, edging up 0.2 percent and remaining at the highest level since November 2001.

However, this masked some variability within the transportation sector.

Unfilled orders rose for the tenth consecutive month in the aerospace industry, partly as a result of a huge jump in new orders in February. This was offset by a decrease in unfilled orders for the motor vehicle and motor vehicle parts industries.