The first quarter confidence levels (measured by the purchasing managers’ sub-index for business activity) were strongly negative (-5%), and have now been followed by equally disappointing production numbers for the second quarter. Actual production for the sector fell by 5% on the second half of 2014 (seasonally adjusted -2%).
“Having hoped for better growth than the 2% recorded during 2013, these numbers indicate that 2014 production could actually be lower than that of 2013, says Mr Langenhoven, adding that the third quarter started even worse with production in July dramatically lower due to industrial action”.
- June production was 3% higher than May 2014, due to pre-emptive stock building.
- On a 12 month basis, growth slowed down to 0,8% (12 months ended in June vs similar period ending in June 2013).
- June 2014 production was 1% lower than June 2013.
- The basic ferrous, non-ferrous, other fabricated metal products, electrical machinery and equipment and the household appliance sub industries saw some growth on a 12 month basis.
Production capacity utilisation numbers show similar downward trends, with overall utilisation declining by 0,1% over 12 months.
Other comparisons are;
- The second quarter 2014 was 1,1% lower than the first quarter,
- The first half of 2014 was 0,1% lower than the first half of 2013, and
- The second quarter was nearly 2% lower than the second quarter 2013.
“It is expected that the third quarter of 2014 will not be much better, although the survey capacity utilisation will be done in August, the month immediately after the July strike,” Mr Langenhoven said.
He added that accelerated production may be the result of compensation for losses incurred in July.