U.S. Manufacturing Business Continues Growth
Manufacturing expanded in February and the general U.S. economy grew for the 118th consecutive month, according to the nation’s supply executives in the latest Manufacturing ISM Report On Business. The February PMI registered at 54.2 percent, a 2.4 percent decrease from the January reading of 56.6 percent.
The Report On Business measures its data using the Purchasing Manager’s Index (PMI), which is an indicator of economic health in the manufacturing sector. A reading above 50 percent indicates that the manufacturing economy is generally expanding, while below 50 percent indicates that it is generally contracting.
“Comments from the panel reflect continued expanding business strength, supported by notable demand and output, although both were softer than the prior month,” said Timothy R. Fiore, chair of the Institute for Supply Management (ISM) Manufacturing Business Survey Committee. “Demand expansion continued, with the New Orders Index reaching the mid-50s, the Customers’ Inventories Index scoring lower and remaining too low, and the Backlog of Orders returning to a low-50s expansion level. Consumption (production and employment) continued to expand but fell a combined 8.9 points from the previous month’s levels. Inputs-expressed as supplier deliveries, inventories and imports-stabilized at a mid-50s level and had a slight negative impact on the PMI. Inputs continue to reflect an easing business environment, confirmed by Prices Index contraction.
“Exports continue to expand, at slightly stronger rates compared to January,” Fiore added. “The manufacturing sector continues to expand, but inputs and prices indicate easing of supply chain constraints.”
Of the 18 manufacturing industries, 16 reported growth in February, in the following order: Printing & related support activities; textile mills; computer & electronic products; electrical equipment, appliances & components; fabricated metal products; paper products; wood products; primary metals; chemical products; food, beverage & tobacco products; miscellaneous manufacturing; petroleum & coal products; transportation equipment; machinery; furniture & related products; and plastics & rubber products.
The only industry reporting contraction in February was nonmetallic mineral products.
Commodities Up in Price
Aluminum, electronic components, paper-based products, plastic components, printed circuit board assemblies, steel, hot rolled steel, and steel products.
Commodities Down in Price
Aluminum, caustic soda, memory, oil, steel, hot rolled steel, and steel products.
Commodities in Short Supply
Capacitors, electronic components, and resistors.
“Decreases were reported in aluminum, steel, steel-based products, various chemicals and plastic resins,” Fiore said. “Steel prices have returned to more normal levels. Price increases and shortages continue for passive electronic components.”