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Investing.com -- Canada’s wholesale trade sector notched a modest rebound in June, as sales excluding petroleum and grain rose 0.7% to $84.7 billion, according to data released Friday by Statistics Canada. The increase, supported by solid performances in the food and miscellaneous subsectors, comes after a weaker second quarter overall.
Gains were seen in four of the seven wholesale subsectors, which together accounted for just over half of total sales. The food, beverage and tobacco subsector led the gains, climbing 1.7% to $15.6 billion, while the miscellaneous subsector rose 2.4% to $10.7 billion, driven by activity in mineral, ore and precious metals.
In volume terms, wholesale sales rose 0.6% in June, suggesting that the month’s recovery was not purely driven by price effects. On a year-over-year basis, wholesale sales were up 3.2% in June.
Despite the positive topline figure, underlying pressures remain evident, particularly relating to Canada–US trade frictions. Feedback from respondents indicated that 33.6% of wholesale businesses experienced impacts from the tensions, with the machinery, equipment and supplies subsector most affected at 38.3%, citing price increases and changes in demand as leading concerns.
Regionally, Quebec led the provincial gains with a 1.9% increase in wholesale sales to $15.3 billion, bolstered by strength in miscellaneous and building materials. Ontario followed with a 0.7% increase to $43.8 billion, while Alberta dampened the national performance, posting a 2.9% decline.
Inventory levels moved higher in June, climbing 0.9% to $131.7 billion, led by gains in agriculture supplies and building materials. The inventory-to-sales ratio, a key operational metric, held steady at 1.55, indicating balanced stock relative to turnover.
However, June’s rebound was insufficient to offset a quarterly decline. For the second quarter, wholesale sales fell 1.7% to $253.0 billion, as six of the seven subsectors registered lower sales, including a 2.5% decline in machinery, equipment and supplies, and a 3.4% drop in building materials.
Looking ahead, the data suggest that while certain sectors show resilience, broad-based recovery may hinge on resolving trade policy challenges and stabilizing demand across key industries.