OTTAWA -- Canadian manufacturing sales fell 1.6 per cent in February as the auto sector faced a shortage of microchips that forced some assembly plants to ramp down production or shut down.
manufacturing totalled $55.4 billion in February on lower sales of transportation equipment, offset in part by higher sales in the petroleum and coal product, chemical, and wood product industries.
The drop in February followed a revised gain of 3.4 per cent in January and put total manufacturing sales down 0.8 per cent compared with a year earlier.
Stephen Brown, senior Canada economist at Capital Economics, said the global semiconductor shortage has persisted into March and April, but other surveys suggest activity elsewhere in the manufacturing sector has continued to recover.
"There are no signs yet of the semiconductor shortage easing materially," Brown wrote in a report.
"Nevertheless, manufacturing sales should have received a boost in March as the U.S. weather distortion was reversed, and there are signs that demand is continuing to recover."
Sales for the transportation equipment sector fell 11.4 per cent in February as motor vehicle sales dropped 14.5 per cent and motor vehicle parts sales fell 10.9 per cent.
The plastics and rubber products group lost 8.7 per cent due in part to lower demand for plastic products from the auto industry.
However, higher prices helped sales in the petroleum and coal product industry climb 6.5 per cent in February to reach their highest level since February 2020.
Chemical sales rose 3.8 per cent on higher sales of basic chemicals, followed by soap, cleaning compound and toilet preparation products, while wood product sales climbed 4.0 per cent.
In constant dollars, manufacturing sales fell 4.0 per cent as higher prices partially offset a lower volume of goods sold in February.
This report by The Canadian Press was first published April 15, 2021
