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This is an archived release.
Improved conditions for manufacturing
The results of the Business Tendency Survey indicate positive growth in industrial output in the first quarter of 2005. A rise in the total stock of orders implies that this development is going to continue.
According to the Business Tendency Survey, the manufacturing industry experienced continued growth in output, capacity utilisation and new orders throughout the first quarter of 2005. Home market prices seem to have risen, while export prices are more or less unchanged. The indicator for the number of working months covered by the current stock of orders is somewhat higher than the corresponding figure in 2004, and an increasing number of managers report that their plant is running at full capacity. Despite the positive development, there is no sign of an increase in the total level of employment. The average capacity utilisation is estimated to be about 81 per cent.
The general outlook in the short term (Q2 2005) is considered to be positive, but a decline in export prices is expected. A growing number of managers report that they consider increasing their gross capital investments. The industrial confidence indicator1 is estimated to be 10 (net figure seasonally adjusted). This is a strong signal of further growth in output in the first quarter of 2005. For international comparisons, go to EUROSTAT (EU) and The Swedish National Institute of Economic Research (Sweden).
Intermediate goods: High activity
The results from sectors producing intermediate goods (pulp, paper and paper products, chemical industry, basic metals and others) show clear indications of a rise in output, capacity utilisation and new orders in the first quarter. There are also signs of growth in employment and market prices. The indicator for the number of working months covered by the current stock of orders increased significantly in the first quarter and has reached a high level seen in a historical perspective. An increasing number of managers report that their plant is running at full capacity. Despite the positive development, there is no sign of an increasing growthrate in the total level of employment. The average capacity utilisation is estimated to be about 81 per cent.
The general outlook in the short term is considered to be better, but fewer managers share this opinion. A rise in output and new orders is expected.
Capital goods: Positive signals for the future
The results from producers of capital goods (metal products, machinery and equipment, offshore-related activity and others) indicate a lower growth in the level of production and capacity utilisation despite a considerable growth in new orders. A possible explanation for this is that there is often a time lag between signing a contract and the start of production. This is particularly the case for large projects in the offshore-related industry. The number of working months covered by the current stock of orders has increased significantly in the first quarter 2005 and is now at a high level seen in a historical perspective. For the first time since the second quarter of 2002 the average capacity utilisation is above 80 per cent.
A large number of managers consider the general outlook in the short term to be better than previously. Positive expectations for the development in output, new orders and home market prices support this view.
Consumer goods: Optimism in spite of negative development in the export market
The results from sectors producing consumer goods (food industry, publishing, pharmaceutical industry and others) indicate a stable growth in output and capacity utilisation. A weak development in the export market is offset by increasing domestic demand. Export prices showed signs of a downward movement in the first quarter, while home market prices remained more or less unchanged.
The general outlook in the short term is considered to be positive. This result is supported by expectations for a positive development in the home market. A growing number of managers say that they consider increasing their gross capital investments.
| Assessment of industries in Q1 and the short-term outlook |
| Industry | Prospects | Background | |||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Food products, beverages and tobacco | +(-) | More or less unchanged level of production and capacity utilisation. Reduced level of employment. Demand from the home market has increased, while demand from the export market has declined. Home market prices are more or less unchanged, while export prices have increased. General outlook for Q2 is positive, and both demand and output are expected to rise in the forthcoming quarter. | |||||||||||||||||||||||||||||||||||||
| Wood and products of wood | ++ | Many managers report an increase in the level of production and employment. There has been an increase in new orders from the home market, while new orders from the export market are more or less unchanged. The capacity utilisation is at a high level, and the number of managers pointing at lack of capacity as a limiting factor for production has increased. The general outlook is considered better. This view is supported by expectations of further increases in output and new orders. Prices are expected to rise in Q2. | |||||||||||||||||||||||||||||||||||||
| Pulp, paper and paper products | ++ | Many managers report a higher level of production and capacity utilisation. Reduced employment and more or less unchanged level of new orders received in Q1. Increase in the level of prices. An increasing number of managers report that the level of capacity is a limiting factor for production. Many managers consider the general outlook to be better, and a further increase in production is expected. Increases in prices and new orders are expected in Q2. | |||||||||||||||||||||||||||||||||||||
| Basic chemicals | + | Growth in production, capacity utilisation and employment. Increase in new orders, but fewer than in the previous quarter share this opinion. Prices have increased. General outlook is considered to be more or less unchanged. Further increases in output and new orders are expected in Q2. Export prices are expected to be more or less unchanged. | |||||||||||||||||||||||||||||||||||||
| Basic metals, non-ferrous | + | Increased output and capacity utilisation, although fewer managers share this view. Lower level of employment. Prices have increased. General outlook is considered positive, but fewer than in the previous quarter share this opinion. The levels of production, new orders and prices are expected to rise. A further reduction in the level of employment is expected. | |||||||||||||||||||||||||||||||||||||
| Engineering, total | + | On the whole, the engineering industries show higher levels of production, capacity utilisation and employment in Q1. Many managers report an increase in new orders, especially from the home market. Home market prices have increased, while export prices have fallen. The number of working months covered by the current stock of orders has increased, and is now at the highest level since Q1 2001. Many managers consider the general outlook to be better, and further growth in output and orders are expected in Q2. | |||||||||||||||||||||||||||||||||||||
| Metal products | ++ | Still positive development in the industry, with increases in production, capacity utilisation and employment. Growth in new orders and prices, both in the home and export market. General outlook for Q2 is considered better. This view is supported by expectations of further growth in output, employment and orders. Home market prices are expected to rise, while export prices have fallen. | |||||||||||||||||||||||||||||||||||||
| Machinery and equipment | + | More or less unchanged level of production. Higher level of employment and new orders. Growth in prices in the home market and lower export prices in Q1. The number of working months covered by the current stock of orders has increased and general outlook for Q2 is positive. Increases in output and capacity utilisation are expected. The stock of orders and home market prices are expected to increase. A further decline in export prices is expected. | |||||||||||||||||||||||||||||||||||||
| Electrical and optical equipment | + | Higher level of production and capacity utilisation. More or less unchanged level of employment. Increase in new orders received from the home and export market. Prices have fallen, especially in the export market. General outlook for Q2 is positive, and growth in production, capacity utilisation, employment and orders are expected. A further reduction in export prices is expected. | |||||||||||||||||||||||||||||||||||||
| Offshore-related activity incl. transport industry included | + | Increased level of production, capacity utilisation and employment. New orders from the home market continue to increase, while export orders are more or less unchanged. The number of working months covered by the current stock of orders has increased. Negative development in prices, especially in the export market. General outlook for Q2 is considered better, and further increases in output and stock of orders are expected. | |||||||||||||||||||||||||||||||||||||
| In the column for Prospects a total evaluation of the present situation and expected short-term developments is marked with the symbols + and -. The following codes and constellations are used: |
++
+ ~ - -- -(+) +/- |
Very good
Good Stable Weak Quite weak Weak, but with certain positive indications A situation where the + and - factors even out. |
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The industrial confidence indicator and links to international comparisons are described in the press release Q3 2003..
Additional information
The statistics provide current data on the business cycle for manufacturing, mining and quarrying by collecting business leaders’ assessments of the economic situation and the short term outlook.
Contact
-
Edvard Andreassen
E-mail: edvard.andreassen@ssb.no
tel.: (+47) 40 90 23 32
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Ståle Mæland
E-mail: stale.maeland@ssb.no
tel.: (+47) 95 05 98 88