Wholesale sales in Canada, excluding petroleum products, oilseeds, and grains, experienced a notable decrease in March 2024. The total sales amounted to $81.4 billion, reflecting a 1.1% decline from the previous month. When compared to March 2023, sales were down by 0.4%. This downward trend was observed across several key subsectors, significantly impacting the overall performance of the wholesale trade sector.
The motor vehicle and motor vehicle parts and accessories subsector witnessed the most significant decline, falling by 5.8% to $13.4 billion. This drop was influenced by a 7.0% decrease in the motor vehicle industry group, which can be attributed to manufacturing plants undergoing retooling for new vehicle models. Additionally, the new and used motor vehicle parts industry group saw a reduction of 1.2%, bringing sales down to $2.7 billion.
The miscellaneous subsector also contributed to the overall decline, with sales dropping by 5.0% to $10.2 billion. The agricultural supplies industry group plummeted by 9.0% to $3.4 billion, while the recyclable material industry group saw a staggering 20.0% decrease to $1.1 billion.
Contrarily, the machinery, equipment, and supplies subsector provided a silver lining, with sales increasing by 1.6% to $17.9 billion. This marks the third consecutive monthly rise, driven by growth in three of its four industry groups.
Provincially, Quebec reported the most significant drop in wholesale sales, decreasing by 2.0% to $14.7 billion. This decline followed a positive performance in February. Six out of seven subsectors in Quebec saw reductions, with the building material and supplies subsector falling by 5.4% to $2.2 billion, and the motor vehicle and motor vehicle parts and accessories subsector decreasing by 5.0% to $1.9 billion.
British Columbia experienced the second-largest provincial decline, with sales down by 2.5% to $7.7 billion. The decline followed an increase in February and was primarily driven by decreases in the building material and supplies (-4.9% to $1.8 billion) and the food, beverage, and tobacco (-4.6% to $1.6 billion) subsectors.
Despite the decrease in sales, wholesale inventories rose by 0.7% to $127.5 billion in March, after two months of consecutive declines. The machinery, equipment, and supplies subsector led this increase, with inventories rising by 1.5% to $38.8 billion. The personal and household goods subsector also saw a significant inventory increase of 1.7% to $20.9 billion. However, these gains were tempered by declines in the miscellaneous (-2.4% to $14.9 billion) and the food, beverage, and tobacco (-0.3% to $13.6 billion) subsectors.
The inventory-to-sales ratio, a key measure of how long current inventory levels would last given the current sales pace, increased from 1.54 in February to 1.57 in March.
For the first quarter of 2024, wholesale sales decreased by 0.4% to $245.8 billion, primarily due to the downturn in March. The motor vehicle and motor vehicle parts and accessories subsector faced the largest decline in the quarter, dropping by 4.2% to $41.6 billion. The building material and supplies subsector also saw a decrease, falling by 2.6% to $35.5 billion.
When comparing the first quarter of 2024 to the same period in 2023, wholesale sales were down by 1.3%, indicating a broader trend of declining performance within the wholesale trade sector.
While certain areas such as machinery, equipment, and supplies showed resilience, the overall trend points to a need for cautious optimism as the industry navigates through retooling processes and fluctuating demand across various regions and products. The increase in inventories and the higher inventory-to-sales ratio suggest that businesses are preparing for potential future demand, but the short-term outlook remains mixed.