Petroleum-related manufacturing still struggling

The index level for Norwegian manufacturing in the third quarter of 2017 amounted to 113.5 (2005=100). The corresponding figure for the previous quarter was 114.3. Smoothed seasonally-adjusted figures indicate a falling trend for the last 3 months (see figure 1).

Three-month change: decrease in petroleum-related manufacturing, increase in food products

According to seasonally-adjusted figures, manufacturing output saw a small decrease of 0.7 per cent in the third quarter of 2017 compared to the previous one. Machinery and equipment together with fabricated metal products as well as ships, boats and oil platforms contributed most to the overall decline. Other parts of petroleum-related manufacturing also experienced reduced activity this period and the grouping saw an overall decline of 3.8 per cent. For more details about how petroleum-related manufacturing affects the overall development in manufacturing, see the article Norwegian Manufacturing 2016 – a tough year for manufacturing.

On the opposite side, growth in food products as well as in the industry grouping rubber, plastic and mineral products, contributed to dampen the decline in the overall manufacturing output. Within food products the increase is related to higher activity in processing and preserving of fish. Within rubber, plastic and mineral products the growth is particularly related to a high level of activity in the Norwegian construction sector, where this industry grouping is a supplier of intermediate goods.

Monthly change: increase in manufacturing from August to September 2017

According to seasonally-adjusted figures, manufacturing output increased by 2.6 per cent from August to September 2017. Machinery and equipment, together with the industry grouping computer and electrical equipment as well as repair and installation of machinery contributed most to this growth. The increase must be seen in relation to a weak August.

Twelve-month change: significantly stronger output growth in the Euro area than in Norway in August 2017

According to calendar-adjusted figures, Norwegian manufacturing output saw a minor increase of 0.2 per cent from August 2016 to August 2017. The industry grouping refined petroleum, chemicals and pharmaceuticals fell the most in this period, while ships, boats and oil platforms had the largest positive contribution. Estimated figures from Eurostat, the EU’s statistical office, indicate that output in manufacturing in the Euro area increased strongly by 4.4 per cent in the same period.

Three-month change: growth in total industrial production (PII)

According to seasonally-adjusted figures, the total production index (PII) covering extraction, mining, manufacturing and electricity supply, had a small increase of 0.8 per cent in the third quarter of 2017 compared to the previous quarter. The growth is particularly due to a strong increase of 10.4 per cent within extraction of natural gas. Extraction of crude petroleum, on the other hand, fell by 5.6 per cent. For more details about oil and gas extraction for September 2017, see the press release from The Norwegian Petroleum Directorate.

Within support activities for petroleum and natural gas extraction, output had an increase equivalent to 2.3 per cent in the third quarter of 2017 compared to the previous quarter. Suppliers within this industry are strongly affected by the investment level in the Norwegian oil and gas industry, and the increase can be related to some major projects within the category field development.

In the same period, mining and quarrying saw an increase of 2.8 per cent, while production within Norwegian electricity supply went up by 3.1 per cent.