Most GBI Metalworking Index Components Near All-Time Highs
The GBI: Metalworking has reached a reading of 62.8, with most of the Index components at or near all-time highs.
The Metalworking Business Index reported its fourth month of accelerating activity with every measure reporting expanding conditions.
The metalworking manufacturing industry registered its fourth consecutive month of accelerating expansion with a near 9-point gain, bringing the Metalworking Index to 62.8. Every component of the Index reported expanding activity thanks to export activity registering its first expansionary reading since late 2018. All measures of activity, with the exception of employment, are at or near all-time highs.
Export orders have been underwhelming since 2018; however, improving global demand in the first quarter of 2021 resulted in an all-time high reading in March.
The rise in supplier deliveries activity is a sign of lengthening order-to-fulfillment times. Unfortunately, layers of supply chain disruption that first started last year continue to be felt. The result has been underwhelming production levels, made worse by the latest ship port bottlenecks. The trouble with adequate supply has worsened because of strong consumer demand for durable goods, which is a result of stimulus measures and rebounding employment in many sectors. The net effect of these shocks to supply and demand has been evident in Gardner’s pricing data. Virtually all manufacturers are reporting rising upstream material prices while a smaller proportion of these same firms are passing higher costs on to their customers. Eventually, these manufacturers will be compelled to push price increases through for their own products or assume the even more difficult challenge of facing further profit margin compression after having just endured a difficult 2020.
Finding reliable and relevant data to help guide your business is always important, but especially so during challenging economic times. For this reason, the GBI Metalworking Index serves as a great tool for making data-driven decisions. Thank you to everyone who has previously completed our GBI surveys. Your participation helped increased response counts by 15% in 2020, making the GBI better than ever because of your involvement. Thank you for your time and efforts and for trusting us to provide you with the latest industry and business insights both in the past and in the future.