Weak demand keeps the mood in manufacturing in doldrums
Weak demand continues to dog the South African manufacturing sector, according to the Absa Manufacturing Survey, which was released on Wednesday.
Domestic demand indicators fell further into negative territory compared to the first quarter of 2016. In addition, the bank said, it seemed there was little additional support from external demand, with the export indicators remaining relatively downbeat.
While volume growth remained under pressure, manufacturers did report an acceleration in the rate of increase of the average domestic selling price, Absa said in a statement. Given low volume growth, manufacturers may have faced a trade-off between pushing for volume growth or charging higher prices.
The output indicator was stuck in negative territory for the sixth consecutive quarter and the employment indicators fell to multi-year lows.
The manufacturing sector has been shedding jobs over the past few years and is one of the few sectors in the economy that has not regained any jobs lost during the economic recession of 2008/9. Unfortunately, Absa said, the survey did not point to a turnaround.
Overall manufacturing business confidence ticked up by 5 index points in the second quarter of 2016. Despite the slight increase, at the current level, about eight out of ten manufacturers remained unsatisfied with prevailing business conditions.
Looking ahead, Absa said, sustained rand weakness might provide a glimmer of hope if it lead to more import substitution and/or improved export volumes. But, all in all, it seemed as if the manufacturing sector would continue to face headwinds and business confidence seemed likely to remain relatively subdued in coming quarters.
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation