The SME manufacturing industry It fell 9.9% in February compared to the same month last year, at constant prices. It is the third consecutive month in which factory activity has fallen, although the rate slowed after having fallen between 27% and 30% in December and January, respectively. In the monthly, seasonally adjusted comparison, a decrease of 7.7% was also recorded and in the accumulated figure for the year, activity fell 21.7%.
The companies operated in February with 70.9% of their installed capacitymaintaining January levels (70.8%). Although 32.7% of industries continue to report problems replenishing stock, they are much smaller scale difficulties than previous months.
What was most worrying in February were cost increases, especially in services and fuels. The industries consulted expressed the difficulties involved in translating these increases into prices in the current context. At the same time, there is uncertainty about the impact that the opening of imports could have in some sectors.
SME industry: sector-by-sector analysis
Five of the six manufacturing sectors of the SME segment surveyed had falls in the annual comparison, but the most affected were “Paper and Printing” (-24.6%) and “Chemicals and Plastics” (-23.1%).
Food and drinks
The sector registered a fall of 0.3% annually at constant prices in February and 1.1% in the month-on-month comparison. In the first two months of the year there is an accumulated decrease of 14.6% annually. The industries operated with 71.9% of their installed capacity. In February, price increases in inputs to the sector continued, but at the same time deliveries normalized in the face of a somewhat more predictable economic situation. Even so, companies pointed out damages due to cost increases, mainly in energy and transportation.
Clothing and Textile
The sector grew 10.5% annually in February, although it registered a drop of 2.4% compared to January. In the first two months of the year it accumulates a decrease of 1.3% annually. Industries operated with 72.6% of their installed capacity, 4.4 points above last month, reflecting the rebound in production. The start of the school year and sports activities raised demand from SMEs focused on this segment, which had had very little demand in January. Businessmen consulted stated that today the sector’s biggest concern is the possibility of opening up imports, which would take many industries out of the market.
Wood and Furniture
In February the sector fell 10% annually at constant prices and 3% in the month-on-month comparison. For the first two months of the year, there is an annual decrease of 24.6%. Industries operated with only 70.2% of their installed capacity, 0.2 points below January. Companies linked to the public works sector are those that are going through the most difficult situation due to the paralysis of that activity. At the same time, in the sector they point out that the projects that are activated are small in size and that there are problems in obtaining inputs. Companies focused on furniture manufacturing point out that the increase in the price of wood makes the budgets that are passed unviable.
Metallic, Machinery, Equipment and Transport Material
The sector had a contraction of 15.2% annually at constant prices in February and 4.9% in the month-on-month comparison. In the first two months of the year there is a drop of 27.9% compared to the same period last year. Industries operated at 68.9% of their installed capacity, almost 2 points above January. There were reports of shortages of inputs, although to a lesser extent than last year, and increases in raw material prices. Being an activity that is very transversal to the rest of the industries, businessmen see a complex panorama for the coming months.
Chemical and Plastic Products
Activity in the sector contracted 23.1% annually in February, always at constant prices, and 6.2% in the month-on-month comparison. With this result, in the first two months of the year there is a decrease of 31.2% compared to the same period last year. During this month, industries operated with 69.9% of their installed capacity, almost unchanged compared to January (70.6%). Companies that import inputs indicated that despite the Bopreal issued by the national government, they continue to have problems paying off foreign debts and that prevents them from purchasing inputs.
Paper, Cardboard, Publishing and Printing
The sector experienced a marked drop of 24.6% annually at constant prices in February and accumulated a decrease of 26% in the first two months of the year. In monthly terms, a contraction of 4.8% was also recorded. The companies operated with 76.3% of their installed capacity, 1.8 points more than in January. There was a significant deterioration in the payment chain and more problems collecting from the customer. This, added to the increases in operating costs, deteriorated the profitability of the activity. Faced with a lack of demand, industries had difficulties translating higher costs into prices in a slowly growing consumer market.
Source: Ambito
