which accounts for nearly half of the region’s manufacturing shipments, was more affected by lower prices for petroleum products and total shipments consequently fell 10.6%. Newfoundland and Labrador, Nova Scotia and Prince Edward Island registered small increases on the strength of modest increases in food shipments.

In Quebec, shipments increased 1.2% to $11.9 billion. The province’s largest manufacturing industry, primary metals, experienced strong gains on record commodity price levels, rising 4.4% to $1.8 billion, the highest level on record. This increase, coupled with a 29.4% increase in shipments from the chemicals industry to $1.0 billion, offset declines in the aerospace and oil refining industries.

Declines in Ontario’s manufacturing industries were modest but widespread as two-thirds of them lost ground. Total shipments slipped 0.4% to $23.0 billion in October. Transportation equipment, Ontario’s largest manufacturing sector, edged down 0.8% to $7.0 billion. The value of petroleum refining fell by 5.9% to $1.3 billion, consistent with commodity price declines. The machinery industry bounced back from a two-month slide with a 14.3% increase to $1.4 billion.

In Alberta, a three-month slide in oil prices was behind a 1.9% drop in shipments to $5.2 billion. Shipments of petroleum and coal products fell 6.9% to $1.0 billion in October. Chemical production, Alberta’s leading manufacturing industry, fell 4.5% to $1.2 billion in October.

On the Prairies, shipments fell 0.9% to $7.3 billion. Alberta’s shipments accounted for nearly three-quarters of this total. Consequently, a 4.2% gain in shipments in Saskatchewan, which reached $857 million, was not able to offset the decline in Alberta. Shipments from Manitoba remained virtually unchanged at $1.1 billion.

Shipments from British Columbia increased 0.9% to $3.5 billion as increases in non-metallic minerals, primary metals and petroleum and coal products offset the declines for shipments of wood products and food.

Release taken from Statistics Canada

Factory shipments hit their lowest level in nearly two years in October, mainly because of falling petroleum prices and a slowdown in the food and transportation equipment sectors.

Canadian manufacturers shipped goods worth an estimated $47.7 billion, down 0.1% from September and the lowest level since December 2004. While the rate of decline has eased, shipments have fallen for three consecutive months. As has been the case in three of the last four months, falling prices have been a major factor in the decline in shipment value.

After taking price fluctuations into account, the volume of shipments was down 0.6% to $43.7 billion, the lowest volume of shipments in nearly four years.

On a year-to-date basis, the volume of shipments fell 1.5% between January and October this year, compared with the same period last year.

Manufacturing shipments were essentially stuck in neutral with 10 of 21 manufacturing industries falling, 10 rising and 1 virtually unchanged in October.

Durable goods shipments turned around following three months of decline in the last four, rising 0.8% to $25.9 billion thanks to a strong showing in the machinery sector.

Non-durable goods shipments have declined on lower commodity prices for the past three months, falling by 1.1% to $21.9 billion in October.

According to the Labour Force Survey, manufacturing employment continued its downward trend in October, falling by 15,000 and down 83,000 over the first 10 months of 2006. The lion’s share of the losses were experienced in Ontario and Quebec.

Lowest output in motor vehicle industry in over three years

Transportation equipment fell 1.4% to $8.8 billion, the fourth consecutive decline and seventh monthly drop this year.

Despite a relatively strong month of automotive sales on both sides of the border, shipments in the motor vehicle industry fell 1.0% to $4.5 billion, the lowest level in over three years. This was due, in part, to a late start launching some 2007 model vehicles.

A combination of a slowdown in auto assembly and increased sourcing of parts from off-shore suppliers resulted in shipments falling from auto parts suppliers by 2.4% to $2.1 billion. It was the fourth monthly decline and the lowest level of shipments since June 1998.

Aerospace shipments fell 9.4% to $1.2 billion following strong quarter-end deliveries in September. Due to the high value of product of the aerospace industry, monthly swings of plus or minus hundreds of million dollars are not unusual. For the first 10 months of 2006, aerospace shipments were 4.1% lower than in the same period of last year.

Canadian refineries continued to produce at normal levels, but at reduced prices. Consequently, shipments of petroleum and coal products fell 6.2% to $4.4 billion. Prices declined by 6.3% because of burgeoning inventories of gasoline and crude oil in the United States in October.

Machinery manufacturing shipments rebounded from their lowest level in 14 months, with the single largest increase in shipments in October, an 8.6% jump to $2.7 billion. The machinery sub sector includes a broad variety of industries engaged in manufacturing industrial and commercial machinery.

Food manufacturing returned to normal shipment levels after an exceptional month in September. Food shipments fell 2.4% to $5.6 billion.

Shipments increase in seven provinces

All Atlantic provinces but New Brunswick posted gains in October. New Brunswick,