Economic activity in the manufacturing sector expanded in January for the 20th consecutive month, and the overall economy grew for the 68th consecutive month, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®.
The report was issued today by Bradley J. Holcomb, CPSM, CPSD, chair of the Institute for Supply Management®(ISM®)Manufacturing Business Survey Committee. “The January PMI® registered 53.5 percent, a decrease of 1.6 percentage points from December’s seasonally adjusted reading of 55.1 percent. The New Orders Index registered 52.9 percent, a decrease of 4.9 percentage points from the seasonally adjusted reading of 57.8percent in December. The Production Index registered 56.5 percent, 1.2 percentage points below the seasonally adjusted December reading of 57.7 percent. The Employment Index registered 54.1 percent, a decrease of 1.9 percentage points below the seasonally adjusted December reading of 56 percent. Inventories of raw materials registered 51 percent, an increase of 5.5 percentage points above the December reading of 45.5 percent. The Prices Index registered 35 percent, down 3.5 percentage points from the December reading of 38.5 percent, indicating lower raw materials prices in January relative to December. Comments from the panel indicate that most industries, but not all, are experiencing strong demand as 2015 kicks off. The West Coast dock slowdown continues to be a problem, negatively impacting both exports and imports as well as inventories.”
Of the 18 manufacturing industries, 14 are reporting growth in January in the following order: Primary Metals; Wood Products; Printing & Related Support Activities; Miscellaneous Manufacturing; Fabricated Metal Products; Electrical Equipment, Appliances & Components; Petroleum & Coal Products; Paper Products; Transportation Equipment; Chemical Products; Machinery; Food, Beverage & Tobacco Products; Computer & Electronic Products; and Furniture & Related Products. The two industries reporting contraction in January are: Textile Mills; and Nonmetallic Mineral Products.
WHAT RESPONDENTS ARE SAYING …
- “Strong customer demand for our products continues to grow.” (Food, Beverage & Tobacco Products)
- “Customers are presenting many new opportunities.” (Fabricated Metal Products)
- “Consumer demand remains strong for automotive. Seeking alternatives to maximize production with existing production capacity.” (Transportation Equipment)
- “Chinese New Year, West Coast port dock slowdowns, coupled with railroad embargo are all creating logistical challenges and increased backlog of orders.” (Wood Products)
- “Sales have stayed very strong even with the dip in oil prices.” (Computer & Electronic Products)
- “Dock problems in California continue to delay shipment out of the West Coast. Most material prices are the same except resin prices are down.” (Chemical Products)
- “Business conditions are good, stable to improving.” (Miscellaneous Manufacturing)
- “West Coast port slowdown is getting serious. Mill has 40+ days of production at the ports and various warehouses.” (Paper Products)
- “Agriculture equipment production remains weaker than previous year as farm commodity prices remain low.” (Machinery)
- “Business in 2015 has started off on a fast pace. Very busy.” (Primary Metals)
The full report is available at ISM.