Much of the decline was attributable to lower sales of transportation equipment and petroleum and coal products.
The machinery industry posted the largest sales gain, followed by the wood product and chemical industries.
Manufacturing sales excluding the transportation equipment industry increased 1.5% in April, the 12th consecutive monthly gain.
Sales in constant dollars decreased 3.3% to $49.1 billion in April, indicating a lower volume of goods sold. The Industrial Product Price Index increased 1.6% in April, while prices of raw materials were up 1.0%. Higher prices for lumber and other wood products (+6.4%), meat, fish and dairy products (+4.1%), primary ferrous metal products (+2.9%), and chemicals and chemical products (+1.5%) contributed the most to the industrial product price increase in April.
Although the Canadian auto industry has been affected by the global shortage of semiconductor chips since January, the impact worsened in April as every major auto manufacturer had to halt or ramp down production.
Motor vehicle sales were down by over one-third (-36.5%) to $2.3 billion in April, the largest month-over-month decrease since April 2020. In the motor vehicle parts industry, sales fell 19.0% to $1.9 billion, the lowest level since May 2020. The semiconductor chip supply shortage is expected to continue throughout the second quarter. Exports of motor vehicles and parts decreased 18.1% in April.
Following six consecutive monthly increases, sales of petroleum and coal products declined 7.1% to $5.1 billion in April because of maintenance shutdowns at some refineries. Despite the decline, year-over-year sales were up 160.7% from the unprecedented lows during the first wave of the COVID-19 pandemic. Petroleum product sales in constant dollars decreased 4.9% in April.
Sales of non-metallic mineral products declined 5.6% to $1.4 billion, on lower sales in all industries except cement and concrete product manufacturing. Despite the decline, sales were up 57.3% year over year.
Machinery sales rose 14.6% to $3.7 billion in April, the highest level on record. Year over year, sales of machinery increased 29.3%.
Wood product sales rose 6.5% to a record-high $4.9 billion in April, mainly on higher prices. Sawmills and wood preservation manufacturing accounted for most of the gain.
Sales of chemicals rose 5.0% to $5.1 billion in April, on higher sales of basic chemicals, as well as resin, synthetic rubber, and artificial and synthetic fibres and filaments.
Sales also increased in the food (+1.1%) and primary metal (+2.2%) industries in April.
Sales in Toronto decreased 14.5% to $9.1 billion in April, on lower sales of motor vehicles and motor vehicle parts. Motor vehicle sales dropped by nearly half (-49.7%) in April as all auto assembly plants in Toronto lowered production because of the semiconductor chip shortage.
Total inventories rose 0.8% to $89.2 billion in April on higher inventories of machinery (+5.0%), motor vehicles (+8.7%) and food (+1.5%). Inventories were down in the aerospace product and parts (-2.2%) and the non-metallic mineral product (-7.5%) industries.
The inventory-to-sales ratio increased from 1.52 in March to 1.56 in April. The ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.
Unfilled orders edged down 0.1% to $87.0 billion in April on lower unfilled orders of aerospace products and parts (-1.2%) and computer and electronic products (-6.1%). On a year-over-year basis, unfilled orders were down 11.4%.
The total value of new orders decreased 2.5% to $57.0 billion in April, driven by lower new orders in the transportation equipment industry (-20.8%). New orders rose 8.5% at chemical manufacturers.
The capacity utilization rate (not seasonally adjusted) for the total manufacturing sector fell from 80.1% in March to 75.6% in April, driven by lower production.
The capacity utilization rate of the transportation equipment industry fell 23.8 percentage points, attributable to lower production at motor vehicle assembly and motor vehicle parts plants associated with the semiconductor chip shortage.
The capacity utilization rate for the petroleum and coal product industry declined 4.0 percentage points to 79.3%. Turnaround and maintenance work at some refineries were behind most of the decline. The capacity utilization rate of chemical manufacturers rose 2.7 percentage points. ■