Friday, September 10, 2010
Vital Statistics
19 Sep 2007
Manufacturing sales and volumes increase in the June 2007 quarter
Fiona Stokes
Growth in manufacturing sales has been confirmed by Statistics New Zealand latest release of the Economic Survey of Manufacturing.
Total manufacturing sales and manufacturing volumes both increased by 1.7% in the June quarter. This implies zero price inflation in the manufacturing sector over the June quarter. For the year to June, manufacturing volumes were an average 1.3% higher than year earlier.
Leading the increase in manufacturing sales was basic metal manufacturing (up 12.2% on the previous quarter), wood product manufacturing (up 6.6%), transport equipment manufacturing (up 11.9%), structural, sheet and fabricated metal product manufacturing (up 4.2%), and other food manufacturing (up 2.6%).
This is the third quarter in a row that manufacturing sales in basic metal manufacturing have increased. In the March quarter this sector had a 4.6% growth in sales. In addition, manufacturing volumes grew 10.8% during the June quarter.
Wood product manufacturing sales were up in the June quarter following a decrease of 1.4% in the March quarter. Sales volumes for this export dominated sector were also up 5.8% compared with the previous quarter.
As mentioned in BERL Forecasts for September 2007, international log prices are rising due to an increased demand from Korea and south-east Asia. The Ministry of Agriculture and Forestry also predicts strong log prices if the Russian Federation raises soft-wood export taxes. While the downturn in the US housing market has not impacted on New Zealand’s forestry exports, the US does account for around 12% of New Zealand’s forestry exports in value terms. Hopefully, any serious decline in exports to the US will be offset by the increasing demand from China and India.
Overall, manufacturing sales in the transport equipment manufacturing sector have been steady. This is despite an 11.9% increase in sales in the June quarter and a 13.5% decrease in the March quarter.
Meat and dairy product manufacturing sales decreased 1.1% in the June quarter, after a 1.9% increase in the March quarter. This decrease in sales was due to lower prices for meat and dairy, and lower export volumes.
There has been a seasonal lift in beef and lamb prices but prices are still below those received last year. In addition, although world commodity prices for dairy products have risen over the past year, these increases have not yet flowed through to export data. As noted in BERL Forecasts for September 2007, dairy export revenue for the year to June 2007 was $6.4bn, a rise of 12.1% on the previous June year. With meat volumes was up 14%, this implied unit prices were down 0.7%.
Other areas that saw a decrease in manufacturing sales were rubber, plastic and other chemical products manufacturing (down 2%), and furniture and other manufacturing (down 4%).
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