In January 2024, Canada witnessed a marginal yet noteworthy uptick in wholesale trade, excluding petroleum, petroleum products, and certain other hydrocarbons, along with oilseed and grain, according to data released on March 15, 2024. This increase, albeit modest at 0.1%, brought wholesale sales to $82.4 billion.
The machinery, equipment, and supplies subsector emerged as a key driver, experiencing a 1.4% surge to reach $17.4 billion in sales. Notably, this marked the first increase in five months for this segment. The growth was fueled by a remarkable upswing in the computer and communications equipment and supplies industry group, which recorded a substantial 10.0% increase to $4.9 billion. However, this growth was somewhat tempered by declines in other segments within the machinery and equipment domain.
Concurrently, the personal and household goods subsector continued its upward trajectory for the fourth consecutive month, climbing by 1.8% to $12.0 billion in January. This growth was propelled by gains in three of the subsector’s five industry groups, with the textile, clothing, and footwear industry group standing out with a notable 14.7% increase to $1.5 billion.
However, not all segments experienced growth. The building material and supplies subsector, for instance, witnessed a decline for the second consecutive month, dipping by 2.9% to $11.7 billion in January. This decline was particularly pronounced in the lumber, millwork, hardware, and other building supplies industry group, which fell by 3.8%.
Provincially, Quebec emerged as a leader in wholesale sales growth, posting a robust 0.8% increase to $14.8 billion in January. This growth was bolstered by gains in the miscellaneous subsector and the food, beverage, and tobacco subsector. Conversely, Ontario experienced a slight setback, with wholesale sales declining by 0.2% to $42.6 billion. This decline was attributed to decreases in the miscellaneous and food, beverage, and tobacco subsectors.
Inventories, a critical indicator of economic activity, saw a decline of 1.1% to $128.0 billion in January. Notably, this decrease was observed across four of the seven subsectors, with motor vehicle and motor vehicle parts and accessories merchant wholesalers registering the most significant decline at 4.5%. Conversely, machinery, equipment, and supplies merchant wholesalers saw a marginal decline of 1.1%.
The inventory-to-sales ratio, a key metric gauging inventory management efficiency, fell from 1.57 in December to 1.55 in January. This suggests a slight improvement in inventory turnover, indicating a shorter time required to deplete existing inventories at current sales levels.
Despite challenges in certain segments, such as the building materials and supplies subsector, other areas, particularly machinery, equipment, and personal and household goods, show resilience and promise. Provincial disparities, notably the growth in Quebec juxtaposed with a slight decline in Ontario, underscore the diverse economic landscapes within Canada. Moving forward, monitoring inventory dynamics will be crucial in assessing supply chain resilience and overall economic vitality.