Manufacturers again less positive

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© Hollandse Hoogte / Frank Muller / Zorginbeeld
According to Statistics Netherlands (CBS), Dutch manufacturers were again less positive than in the previous month. Producer confidence declined from 1.0 in June to 0.1 in July. This is the lowest level since March 2021.The decline is largely because manufacturers were less positive about order positions.

In July, producer confidence was below the 20-year average of 1.4. It reached an all-time high (12.7) in November 2021 and an all-time low (-28.7) in April 2020.

Opinions on order positions deteriorated in particular

Manufacturers were mainly less positive about their order positions in July. They were also less positive about the expected output in the next three months. However, their opinion about current stocks of finished products was less negative.

Although all three component indicators of producer confidence deteriorated, two were positive. The majority of manufacturers consider their order position to be strong rather than weak, given the time of year. Furthermore, manufacturers anticipating output to increase over the next three months outnumber those expecting a decrease.

However, there was one negative component indicator: more manufacturers define their current stock of finished products as too large rather than too small.

Producer confidence down in three quarters of industries

In three quarters of the major manufacturing industries, producer confidence deteriorated in July. Just as in the preceding months, confidence was highest in the electrotechnical and machinery industry. Confidence was again lowest in the timber and building materials industry.

Manufacturing output over 9 percent down in May

Almost three weeks ago, CBS reported that in May 2023 the average daily output of the Dutch manufacturing industry was 9.2 percent lower than in May 2022. Output also contracted year on year in the preceding months of 2023.

New business confidence methodology

On 15 August 2023, business confidence will be published according to a new method for the first time. Business confidence in the total Dutch business economy is a weighted average of the confidence indicators in the underlying industries Under the new methodology, business confidence is longer equal to producer confidence in manufacturing. Additional information and explanation on this new business confidence methodology will follow when figures are published on 15 August.

Sources

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