March 10, 2016 / 1:47 PM / a year ago

Canadian industrial capacity use dips in fourth quarter

Production Associates inspect cars moving along assembly line at Honda manufacturing plant in Alliston, Ontario March 30, 2015.Fred Thornhill

OTTAWA (Reuters) - Canada's industrial capacity use dipped in the fourth quarter from the prior period on a decline in activity in the construction and oil and gas extraction sectors, data from Statistics Canada showed on Thursday.

Capacity utilization was 81.1 percent in the quarter, shy of economists' expectations of 81.6 percent. Statscan lowered the third-quarter figure to 81.6 percent from an initially reported 82.0 percent.

Lower activity in most parts of the construction industry sent the sector's utilization rate down to 83.7 percent from 84.7 percent in its fourth consecutive quarter of declines.

The oil and gas industry operated at 78.3 percent of its capacity, down from 79.4 percent as extraction volumes fell. The energy sector has suffered because of the drop in oil prices.

The manufacturing sector overall ran at 83.3 percent of its capacity, down slightly from 83.4 percent. The utilization rate fell in 12 of the industry's 21 major groups. Those groups accounted for about 60 percent of manufacturing's gross domestic product.

For the year overall, the average capacity utilization rate fell 1 percentage point to 81.3 percent. The cheaper price of oil, a major Canadian export, put Canada in a mild recession in the first half of 2015.

Reporting by Leah Schnurr; Editing by Lisa Von Ahn

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