Composites Index expands for first time since June
The Composites Index for January 2020 was 54.3, indicating strong expansion in all categories but exports.
Positive industry shifts. January experienced a strong shift in the industry after posting lackluster results in the second half of 2019. Business activity was reported as broadly expanding across all measures except for exports.
The Composites Index reported expanding business conditions for the first time since June 2019, registering 54.3 in January. Index readings above 50 indicate expanding activity while values below 50 indicate contracting activity. The further away a reading is from 50, the greater the change in activity. Gardner Intelligence’s review of the latest data found that the Index was supported by expanding activity in production, new orders and backlogs. The Index was restrained by supplier deliveries, employment and exports. All components excluding exports reported expanding activity during the month.
Production and new orders data reported expanding activity at rates not seen since the first half of 2019. The 10-point change in total new orders came despite a quickening contraction in export orders. The combination of these measures implies that domestic demand expanded even faster than illustrated by total new orders. January’s surge in business activity resulted in backlog activity expanding at levels not experienced since 4Q2018 and a resumption of expanding supplier deliveries after a three-month withdraw.
Domestic activity surges into new year. Total new orders surged in January despite a quickening contraction in exports; this suggests that domestic demand for fabricated composites expanded at levels not witnessed in nearly a year.
Fabricators serving the electronics and custom processing end-markets reported strong activity, while automotive fabricators reported a rebound in activity for the first time since October. By company size, larger fabricators reported experiencing the best business conditions among all size categories, while firms under 20 employees reported their ninth month of contracting conditions.
More information about the Composites Fabricating Index can be found at http://www.gardnerintelligence.com/
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