Economy

Canadian factory sales rise 1.5% in August on record primary-metals output, but volumes are flat

Manufacturing sales reached $79.9B, beating forecasts, as metals and chemicals offset a second monthly drop in autos and aerospace; adjusted for prices, sales were unchanged.

By John Wilson · October 15, 2026

Canada's manufacturers had a better August than expected. Statistics Canada reported on Thursday, October 15, that manufacturing sales rose 1.5% to $79.9 billion, after a 0.3% decline in July. Sales were 14.2% higher than a year earlier.

The headline gain, however, was driven mainly by higher prices. In constant dollars, which strip out price changes, total manufacturing sales were unchanged in August.

Numbers versus expectations

Economists had expected a 1.1% increase, in line with Statistics Canada's own advance estimate, according to Trading Economics. The final figure beat that and marked the sharpest monthly rise since April. Sales rose in 12 of 21 subsectors and in six provinces.

Primary metals: up 14.0% to a record $7.6 billion; up 9.1% in volume terms
Chemicals: up 4.4% to $6.2 billion, reversing July's 4.4% decline
Transportation equipment: down 2.6% to $12.0 billion, a second straight monthly drop
Motor vehicles: down 4.0%; motor vehicle parts: down 4.2%; aerospace: down 4.8%
Capacity utilization: 81.9%, up from 80.7% in July
Inventory-to-sales ratio: 1.60, down from 1.62

A tale of two sectors

The report highlights a split inside Canadian industry. Metals producers are benefiting from higher prices and volumes, while the auto and aerospace supply chains, both deeply integrated with the United States, continue to weaken amid the trade dispute with Washington.

Quebec stood out, with sales up 4.0% to a record $21.0 billion, helped by a 20.1% jump in primary metals to $4.0 billion. Newfoundland and Labrador posted a 58.5% gain to $692 million, its highest level since May 2019, driven by non-durable goods.

The gain in primary metals was led by non-ferrous metal (excluding aluminum) production and processing, according to Trading Economics. Unfilled orders were unchanged at $134.2 billion, and inventories edged up 0.2% to $127.7 billion, suggesting order books are holding steady rather than building.

The caution

Flat real sales mean factories did not produce more in August; they mostly sold at higher prices. That is less encouraging for jobs and growth than the headline number suggests. Manufacturing shed 13,000 jobs in September, according to Statistics Canada's Labour Force Survey, and the agency's flash estimate points to only a 0.1% rise in September sales.

The same release showed wholesale sales, excluding petroleum, oilseed and grain, fell 1.6% to $91.6 billion in August, with volumes down 1.8%.

What it means for Canadian households and investors

For workers in auto parts, aerospace and other trade-exposed industries, the data confirm continuing pressure. For everyone else, the report is a reminder that price-driven gains in nominal sales do not necessarily mean a stronger economy.

For investors, strong metals prices have favoured Canada's resource-heavy stock market, but commodity cycles turn. A broadly diversified portfolio avoids relying too heavily on any one sector's momentum. This is general information, not personalized advice.

Sources

General news and information, not individualized financial advice. Figures reflect the publication date.