Manufacturers in the north buoyant

Manufacturers in the north buoyant

Retailers are not the only ones enjoying buoyant Christmas trading conditions according to the latest ANZ - Business NZ Performance of Manufacturing Index (PMI) for November.

Not since the record setting December quarter of 1994 have manufacturers seen a period like the present one, reports the Employers & Manufacturers Association (Northern).

The view is based on the PMI results for October and November, and Statistics New Zealand's Economic Survey of Manufacturing for September.

Manufacturers in the north achieved another high on the PMI for production output without increasing staff to the same extent, said Bruce Goldsworthy, EMA's Manager of Advocacy and Manufacturing.

The PMI is an early indicator measuring manufacturing activity across several critical factors and allows for comparisons to be made with manufacturers in other regions in New Zealand, in Australia, the US, Japan and elsewhere. A reading above 50 indicates growth and below 50 indicates retraction, with the distance from 50 indicating relative strength or weakness.

"Unlike the export led growth of 1994, today's expansion is based as strongly on sales on the domestic market," Mr Goldsworthy said.

"Manufacturers' celebrations would be noisier except for the subduing effects of the rising NZ dollar.

"In particular the cross rate with Australia and the US is keeping the lid on expectations next year, with investment in new projects not achieving the levels necessary to lock in long term growth.

"Manufacturers in the north are outperforming their counterparts in other regions except central New Zealand. Their overall PMI of 65.4 for November is a solid advance on the 59.6 recorded in October, with high levels registered for new orders and production output.

"Some individual reports of trading conditions we have heard lately include: 'building is good, with no end in sight' and 'strong, with Australian building strong as well', 'exports are strong'; plastics: 'very busy', 'revenues 10% over budget' and 'brisk'; packaging: 'never been busier'; metal fabrications: 'going up'; Pharmaceuticals: ''good'; Industrial textiles: very buoyant domestically'."

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