  We propose that the charged-particle multiplicity dependence of the
charm-baryon-to-meson ratio observed in high-energy $pp$ collisions can be
explained by canonical treatment of quantum charges in the statistical
hadronization model (SHM). Taking the full particle listings of PDG
complemented by additional charm-baryon states from relativistic quark model
predictions, we evaluate the canonical partition function and the charm-hadron
chemical factors that measure the canonical suppression arising from the
requirement of strict conservation of quantum charges. We demonstrate that,
while charm number conservation induces common suppression on the production of
both charm-baryons and -mesons, baryon (strangeness) number conservation causes
further suppression on charm-baryons (charm-strange mesons) relative to
nonstrange charm-mesons, thereby resulting in a decreasing $\Lambda_c/D^0$
($D_s/D^0$) ratio toward smaller multiplicity events. The charm-hadron thermal
densities thus computed are then used as pertinent weights to perform
charm-quark fragmentation simulations yielding $p_T$-dependent $\Lambda_c/D^0$
and $D_s/D^0$ ratios at varying multiplicities in fair agreement with ALICE
measurements.
