New orders up, customers' inventories high in Petroleum and Coal Products industry

Economic activity in the manufacturing sector expanded for the 30th consecutive month, and the overall economy grew for the 32nd consecutive month in January, according to the Manufacturing Institute for Supply Management (ISM) Report on Business. The Petroleum and Coal Products industry reported the third highest growth out of 18 manufacturing industries for the month of January.

The PMI registered 54.1 percent, slightly higher than December and an indication that the manufacturing economy is expanding for the 30th consecutive month. A PMI in excess of 42.6 percent over a period of time indicates an expansion of the overall economy.

The New Orders Index registered 57.6 percent in January, almost 3 percentage points higher than December and the 33rd consecutive month of growth. The Petroleum and Coal Products industry registered the highest growth in new orders out of nine industries.

The Production Index decreased more than 3 percentage points to 55.7 percent in January, indicating growth for the 32nd consecutive month. The Petroleum and Coal Products industry reported the sixth highest growth out of nine industries in production for the month.

The Employment Index registered 54.3 percent in January, slightly lower than December and the 28th consecutive month of growth.

Suppliers were slow in their deliveries to manufacturers in January as the Supplier Deliveries Index registered 53.6 percent, more than 2 percentage points higher than December and the 31st consecutive month that supplier deliveries have slowed relative to the previous month. The Petroleum and Coal Products industry reported the slowest supplier deliveries in January out of six industries.

The Inventories Index was 49.5 percent in January, 4 percentage points higher than December.

The Customers’ Inventories Index registered 47.5 percent in January, 5 percentage points higher than December and the 34th consecutive month customers reported their inventories were too low. The Petroleum and Coal Products industry reported customers’ inventories as being too high in January out of five manufacturing industries.

The Prices Index registered 55.5 percent in January, 8 percentage points higher than December and the first month the index has reflected an increase in the price of raw materials since September 2011. The Petroleum and Coal Products industry reported paying the second lowest prices on average in January out of four industries.

The Backlog of Orders Index registered 52.5 percent in January, more than 4 percentage points higher than December. Out of the 80 percent of respondents who reported a backlog of orders, 23 percent reported greater backlogs, 18 percent reported smaller backlogs and 59 percent reported no change from December. The Petroleum and Coal Products industry reported the third highest order backlogs in January out of seven industries.

The New Export Orders Index registered 55 percent in January, 2 percentage points higher than December and the 31st consecutive month the index registered 50 percent or higher.

The Imports Index registered 52.5 percent in January, slightly higher than December and the second consecutive month of growth after 2 months of contraction.

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