PMI continues to signal manufacturing sector's subpar performance

| 0 Comments

 

AbdulDavids2.jpgThe seasonally adjusted Kagiso Purchasing Managers’ Index™ (PMI™) fell to 45.9 index points in July from 46.6 in June.


“The decline in July was expected given that the labour strike by the National Union of Metalworkers of South Africa (Numsa) lasted almost the full month and directly affected many manufacturing subsectors,” says Abdul Davids, Head of Research at Kagiso Asset Management.


He points out that the manufacturing sector’s subpar performance during the past few months is largely a direct result of labour strikes in the platinum mining and the steel and engineering sectors. “Given that [the strike] issues, for the most part, have now been resolved and production should ramp up in coming weeks, the sector should recover during the remainder of the year,” adds Davids.


The Business Activity Index fell to 39.4 points in July, its lowest level in three years. “While the Index has been weak for a while, conditions worsened in July as the Numsa strike forced some producers, including large vehicle manufacturers, to halt production owing to supply disruptions,” notes Davids.


With activity levels remaining low, the Employment Index deteriorated to 43.9 points in July. According to Statistics South Africa’s Quarterly Labour Force Survey, 41 000 jobs were lost in the manufacturing sector during the second quarter of 2014.


Although the New Sales Orders Index increased marginally to 45.4, it remains at a dismal level. Davids says that order volumes could recover in coming months if local demand picks up after the strike-related disruptions, further supported by the improving international environment.


The Price Index rose to 76.5 points, partially owed to the substantial petrol and diesel price increases in July. “While the Rand did strengthen somewhat during the second half of July, the sustained weak level may have placed further upward pressure on the costs of imported input products,” says Davids. “While recent lower international oil prices could alleviate some price pressure, the double-digit wage settlements could push up costs significantly.”
 
View the full report
 

Leave a comment


SmartProcurement Newsletter
X

Please enter your details below to receive the SmartProcurement Newsletter for FREE on a regular basis.

As part of the SmartProcurement Newsletter you will be receiving World Class Procurement News, Tools, Tips, Tactics, Procurement Training updates, Upcoming Events, and the latest Procurement Career Openings.

* Email Address:
* Title:
* First Name:
* Surname:
* Company:
  Position:
* Country:
* Public / Private:

 

Career opportunites

Operations Manager

  • >500 000 Gauteng Operations, Planning & Inventory Permanent Supply Chain
Our client within the FMCG industry with a ...More

Warehouse and Distribution Manager

  • >500 000 Gauteng Logistics & Warehousing Operations, Planning & Inventory Permanent
An exciting opportunity awaits for a Warehouse and ...More

Demand Planner

  • <500 000 Permanent
Get an opportunity to be part of one ...More

Procurement Manager

  • >500 000 Gauteng Permanent Procurement Management Procurement Officer / Specialist
An opportunity for a seasoned Procurement Manager, who ...More

Industrial Engineer

  • >500 000 Gauteng Industrial Engineer Permanent Procurement Consultant
An exciting opportunity that offers extensive exposure on ...More

Deputy Director: Procurement

  • >500 000 Contract Procurement Management Procurement Officer / Specialist Western Cape
Department of Economic Development and Tourism:Procurement Specialist, Ref ...More

DEMAND PLANNING MANAGER

  • >500 000 Gauteng Operations, Planning & Inventory Projects / Category Management
(Total Cost to Company R750k – R900K) excluding ...More

GLOBAL SUPPLIER PERFORMANCE MANAGER

  • >500 000 Gauteng Operations, Planning & Inventory Permanent Projects / Category Management
(Salary: R 1.3M –R1.5M, dependent on level of ...More

GLOBAL CATEGORY MANAGER

  • >500 000 Contract Gauteng Procurement Consultant Projects / Category Management
Total Cost to Company R1mil – R1.2mil excluding ...More

Project Manager

  • >500 000 Contract Procurement Management Projects / Category Management Western Cape
 Description:A well-known retail organization is looking for an ...More

PROCUREMENT ANALYST

  • >500 000 Analyst Gauteng Permanent Procurement Management
Description:A leading infrastructure development group with strong presence ...More

Commodity Manager: Fuels and Lubes

  • Commodities Gauteng Permanent Projects / Category Management
 Ensuring continuity of supply in line with business ...More

Senior Facilities Manager

  • >500 000 Commodities Gauteng Operations, Planning & Inventory Permanent
(Total Cost to Company R800K – R900K) Johannesburg Our ...More

ENGINEERING STANDARDS MANAGER

  • <500 000 >500 000 Gauteng Industrial Engineer Permanent Procurement Management
(Total Cost to Company R350K – R550K) JOHANNESBURGYou ...More

Supply Chain Analyst

  • <500 000 >500 000 Permanent Procurement Officer / Specialist Supply Chain Western Cape
(Total Cost to Company R350K – R550K)  SOUTHERN ...More

Security Manager

  • <500 000 >500 000 Gauteng Permanent Projects / Category Management Strategic Sourcing
(Total Cost to Company R350K – R550K) JOHANNESBURG This ...More

Demand Planner

  • <500 000 >500 000 Operations, Planning & Inventory Permanent Projects / Category Management
(Total Cost to Company R450k – R550k, dependent ...More

Procurement Specialist-Randburg

  • >500 000 Gauteng Permanent Procurement Management Procurement Officer / Specialist
(Total Cost to Company R700k – R800k including ...More

Solutions Architect

  • >500 000 Gauteng Industrial Engineer Permanent Projects / Category Management
(Total Cost to Company R1.3Mil – R1.1Mil including ...More

MANUFACTURING MANAGER - OLIFANTSFONTEIN

  • >500 000 Gauteng Permanent Projects / Category Management
(Total Cost to Company R850k – R950K including ...More