Economy

ISM Manufacturing Index for April 2022

Earlier today, the Institute for Supply Management® (ISM®) released their Manufacturing Purchasing Manager's Index (PMI®) for April 2022:

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Predicted: 57.0%

Actual: 55.4% (-1.7 point month-on-month change)

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Previous month (revised): 57.1%

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Every month, the ISM surveys purchasing and supply executives at hundreds of companies across the country who are involved in manufacturing in some form. The resulting index is watched closely by academics, economists and investors because manufacturing accounts for about 12% of U.S. Gross Domestic Product (GDP).

The PMI is a reliable barometer of U.S. manufacturing: A PMI above 50% implies that U.S. manufacturing expanded during the month specified, while a reading below 50% implies that the made-in-the-USA sector contracted.

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From Today's Report:

"...The April Manufacturing PMI® registered 55.4%. This is the lowest reading since the July 2020 (53.9%.)

Economic activity in the manufacturing sector grew in April, with the overall economy achieving a 23rd consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®..."

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The Following Is A Sampling Of Quotes
From A Diverse Pool Of U.S. Manufacturers:

"...'Tier-2 supplier shutdowns in Shanghai are causing a ripple effect for our suppliers in other parts of China. Long delays at ports, including in the U.S., are still providing supply challenges. Inflation is out of control. Fuel costs, and therefore freight costs, are leading the upward cycle. At some point, the economy must give way; it will be tough to have real growth with such pressure on costs. Despite the issues and poor outlook, business remains brisk.'
[Chemical Products]

'Continued strong demand with improvements in the supply chain. Delays still exist, but supply issues are slowly improving. Cost increases in multiple categories.'
[Transportation Equipment]

'Supply chain is still constrained, and prices continue to rise. We are focusing on ways to stay profitable while continuing to fill customer orders. Relationship management and strong negotiation skills are extremely important right now.'
[Food, Beverage + Tobacco Products]

'New order entries are still very strong. Unfortunately, logistics issues have (not) yet improved, so lead times remain extended.'
[Machinery]

'Due to electronic component supply chain issues, production output has been lower than normal. Backlog is growing due to the supply chain issues. New order sales are steady, except international orders are lower.'
[Fabricated Metal Products]

'Business is strong. Backlog continues to grow due to new orders and inconsistent supply chain conditions. Shortages of components are the main factor limiting our production.'
[Electrical Equipment, Appliances + Components]

'The shutdowns in China due to a new COVID-19 wave are causing supply concerns for late second quarter and early third quarter. We have extended lead times to customers and are ordering product from China to cover demand through Q4 and early 1Q 2023.'
[Miscellaneous Manufacturing]

'Overall, improvements in supply chain are occurring on larger scale items, but we see suppliers that sell us low-volume items struggling in some cases with getting feed stocks and raw materials they need. Freight continues to plague things as well.'
[Nonmetallic Mineral Products]

'Business is still very robust. Material price increases continue to be passed on (to customers) based on costs of raw materials, logistics and labor to produce products.'
[Plastics + Rubber Products]..."

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CHART: ISM Manufacturing Index - April 2022 Update

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Click here to view the complete ISM report

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Labels: Chip_Shortage, Computer_Chips, Coronavirus, COVID-19, COVID19, hard_data, inflation, ism, manufacturing, Pandemic, pmi, purchasing_managers_index, Supply_Chain

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ISM Manufacturing Index for March 2022

Earlier today, the Institute for Supply Management® (ISM®) released their Manufacturing Purchasing Manager's Index (PMI®) for March 2022:

=========

Predicted: 58.0%

Actual: 57.1% (-1.5 point month-on-month change)

=========

Previous month (revised): 58.6%

=========

Every month, the ISM surveys purchasing and supply executives at hundreds of companies across the country who are involved in manufacturing in some form. The resulting index is watched closely by academics, economists and investors because manufacturing accounts for about 12% of U.S. Gross Domestic Product (GDP).

The PMI is a reliable barometer of U.S. manufacturing: A PMI above 50% implies that U.S. manufacturing expanded during the month specified, while a reading below 50% implies that the made-in-the-USA sector contracted.

=========

From Today's Report:

"...Economic activity in the manufacturing sector grew in March, with the overall economy achieving a 22nd consecutive month of growth, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®..."

=========

The Following Is A Sampling Of Quotes
From A Diverse Pool Of U.S. Manufacturers:

"...'No letup yet in supply chain challenges, especially electronic components. Relying more and more on the broker market.'
[Computer + Electronic Products]

'Customer orders are brisk in the face of significant price increases, while we continue to struggle with inbound supplier service and raw material availability issues.'
[Chemical Products]

'Generally speaking, the business environment is slowly improving for aerospace component manufacturers. Supply chain disruptions and still-extending lead times continue to keep purchasing busy. This further causes reevaluation of the current year’s business plan and cost assumptions.'
[Transportation Equipment]

'Overall business conditions are challenging in both domestic and international transportation. The Russian invasion of Ukraine has created uncertainty in the grain markets, causing upward pricing pressure. In addition, inflationary pressures across all categories have made it challenging to manage cost and profitability.'
[Food, Beverage + Tobacco Products]

'Prices are increasing on steel and steel products after a slight decrease from highs last month. Transportation costs are going up significantly with the increase in fuel prices.'
[Machinery]

'Backlog continues to be strong as we ship delinquent orders resulting from COVID-19 slowdowns.' [Fabricated Metal Products]
'Demand continues to be strong. Backlog is still increasing -- currently at about three months of production. Availability of purchased material continues to constrain production, causing the increased backlog.'
[Electrical Equipment, Appliances + Components]

'Business continues to be strong, with incoming sales higher but still combating labor and material issues like availability and inflation. Still determining impact of the Russian invasion of Ukraine.'
[Furniture + Related Products]

'The supply situation is getting worse, with lead times extending over 12 months, material not available, and suppliers not quoting or taking orders. Prices on the rise daily.'
[Miscellaneous Manufacturing]

'Supply chain is still unstable. While we have seen improvements, there are still a lot of issues that have yet to be resolved.'
[Primary Metals]..."

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CHART: ISM Manufacturing Index
March 2022 Update

=========

Click here to view the complete ISM report

=========

Labels: Chip_Shortage, Computer_Chips, Coronavirus, COVID-19, COVID19, hard_data, inflation, ism, manufacturing, Pandemic, pmi, purchasing_managers_index, Supply_Chain

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ISM Manufacturing Index for February 2022

Earlier today, the Institute for Supply Management® (ISM®) released their Manufacturing Purchasing Manager's Index (PMI®) for February 2022:

=========

Predicted: 58.0%

Actual: 58.6% (+1.0 point month-on-month change)

=========

Previous month (revised): 57.6%

=========

Every month, the ISM surveys purchasing and supply executives at hundreds of companies across the country who are involved in manufacturing in some form. The resulting index is watched closely by academics, economists and investors because manufacturing accounts for about 12% of U.S. Gross Domestic Product (GDP).

The PMI is a reliable barometer of U.S. manufacturing: A PMI above 50% implies that U.S. manufacturing expanded during the month specified, while a reading below 50% implies that the made-in-the-USA sector contracted.

=========

From Today's Report:

"...Economic activity in the manufacturing sector grew in February, with the overall economy achieving a 21st consecutive month of growth, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®..."

=========

The Following Is A Sampling Of Quotes
From A Diverse Pool Of U.S. Manufacturers:

"...'Electronic supply chain is still a mess.'
[Computer + Electronic Products]

'Strong sales growth as retail continues to return.'
[Chemical Products]

'Demand for transportation equipment remains strong. Supply of transportation services continues to be a major issue for the supply chain.'
[Transportation Equipment]

'Strong demand has continued beyond our traditional seasonality curves. Coupled with the continuing difficulties in procurement of ocean freight, operational planning and managing costs are our biggest challenges.'
[Food, Beverage + Tobacco Products]

'We have seen year-over-year revenue growth of about 10 percent due to markets coming back. However, in the automotive area, the microchip shortage is causing slowness in growth.'
[Machinery]

'Demand for steel products has increased to historic levels, driven by the automotive and energy industries.'
[Fabricated Metal Products]

'We are expecting a year of strong demand, higher prices and continued supply chain challenges.'
[Textile Mills]

'Demand continues to be strong, increasing our backlog. Production has been more consistent due to availability of parts, but we are not able to increase builds to cut into the backlog.'
[Electrical Equipment, Appliances + Components]