Increased capacity utilization in industry
CNI Indicators ISSN 1676-0212 • Year 20 • Number 11 • November 2017
20 YEARS
INDUSTRIAL SURVEY Increased capacity utilization in industry The November issue of the Industrial Survey shows that industry remains on a recovery path. This recovery trend in industrial activity is also reflected in an increased capacity utilization, which reached 68% in November – the highest rate in almost three years. Industrial production experienced a slight increase between October and November. The index had been showing a drop in production
every November since 2013. Inventories also remain at adjusted levels. At the end of 2017, expectations are more optimistic than they were at the close of the year before. Both demand and purchases of raw materials are expected to grow. Entrepreneurs are also optimistic about foreign sales and expect number of employees to fall only moderately. Investment intentions remain on an upward trend.
Average capacity utilization Percentage (%)
76 74 72
2011
70
2012
68% Nov/17
68
2013 2014
66
2015
64
2016
62
2017
JAN
FEB
MAR
APR
MAY
JUN
JUL
1
AUG
SEP
OCT
NOV
DEC
Industrial Survey ISSN 1676-0212 • Year 20 • Number 11 • November 2017
PERFORMANCE OF INDUSTRY IN NOVEMBER 2017
Production increases in November The production index stood at 50.5 points in November. As it remained above the 50-point mark – although close to that mark – the indicator shows a slight increase in production as compared to October. Since 2013, the index had shown a decline in production in November, particularly in 2014 and 2015. In November 2017, the index hit its highest level for the month since 2011. The indicator of number of employees fell by 0.7 points to 49.0 points. As a result of this decline,
the index moved further away from the 50-point dividing line, pointing to a drop – albeit a moderate one – in employee numbers between October and November. The indices measuring production and employment range from 0 to 100 points, with figures below 50 points indicating a decline in production. The further below 50 points, the more significant and widespread the decline.
Production index for November (2010-2017) Diffusion Indices (0-100) *
52.7 Increase 50
50.5 49.8
Decrease
49.8 48.4 47.0 45.4
40.9 2010
2011
2012
2013
2014
Production
2015
2016
2017
Dividing line
* Figures above 50 points indicate a month-over-month increase in production.
Capacity utilization shows recovery The capacity utilization rate rose by one percentage point from October to November, marking the second consecutive increase in the indicator. As a result, capacity utilization reached 68%, the highest percentage for November in the last three years. Despite the increase, the figure for the month is still 6 percentage points lower than the average for November observed between 2011 (beginning of monthly series) and 2014.
2
The index measuring actual-usual capacity utilization also points to a recovery, although still shows a gap between current and expected activity levels for the month. The index rose by 0.6 points between October and November to 43.6 points, reaching its highest point since March 2014.
Industrial Survey ISSN 1676-0212 • Year 20 • Number 11 • November 2017
Inventories remain at adjusted levels Inventory remained adjusted to the levels planned by companies. The inventory index stood at 48.9 points, showing a moderate decline in inventories. The index measuring
actual-planned inventory levels in turn remained virtually on the 50-point dividing line at 49.8 points, indicating that inventories are adjusted to planned levels.
Evolution of inventories and actual-planned inventory levels Diffusion Indices (0-100) *
Increase/ above planned level
49.9
50
50.1
50.3
50.9 50.4
50.9
51.1 50.7
50.7 50.1
51.0
50.0
49.8
49.5
49.4
49.8
49.6 49.3
49.1
49.0
Decrease/ under planned 48.3 level
49.9
48.9
46.5 NOV 2016
DEC
JAN 2017
FEB
MAR
APR
Evolution
MAY
JUN
Dividing line
JUL
AUG
SEP
OCT
NOV
Actual-planned
* Figures above 50 points indicate an increase in inventories or higher-than-planned actual inventory levels.
EXPECTATIONS FOR INDUSTRY IN DECEMBER 2017
More positive expectations than at the end of 2016 While the indices of expected demand and purchases of raw materials fell from November to December, they remain above 50 points and show growth prospects.
The index measuring export volumes in turn increased by 1.3 points between November and December 2017 and reached 53.5 points, denoting optimism about foreign sales.
The index of expected number of employees fell by 0.5 points to 48.7 points. As a result, it drifted away from the 50-point mark, showing an expected decline in employment at the beginning of 2018.
Compared to December 2016, all expectations indices are significantly up, showing that the outlook for the next six months is more positive at the end of this year.
3
Industrial Survey ISSN 1676-0212 • Year 20 • Number 11 • November 2017
Expectation indices Diffusion indexes (0-100 points)
53.8 53.5 Increase 50 49.9 Decrease
52.1
49.1
48.7
47.2 45.5 DEC 2016
FEB 2017
APR
JUN
AUG
Demand
Purchases of inputs and raw materials
Number of employees Dividing line
Exports
OCT
DEC
* The index ranges from 0 to 100. Figures above 50 points indicate an expected increase over the next six months.
Investment intentions still trending upward The investment intentions index increased by 1.6 points from November and hit the mark of 52.2 points, marking the sixth consecutive monthly increase in the indicator.
The index is 7.6 points higher than that registered in December 2016 and reached its highest level since December 2014, when it stood at 52.4 points.
Investment intentions Diffusion indices (0-100 points)*
55
52.4
52.2
51
47
43
39
DEC 2014
APR 2015
AUG
DEC
APR 2016
AUG
DEC
APR 2017
* The index ranges from 0 to 100 points. The higher the index, the more likely industry is to invest.
4
AUG
DEC
Industrial Survey ISSN 1676-0212 • Year 20 • Number 11 • November 2017
RESULTS BY INDUSTRIAL ACTIVITY AND COMPANY SIZE Performance of industry NUMBER OF EMPLOYEES EVOLUTION
PRODUCTION EVOLUTION
ACTUAL-USUAL CAPACITY UTILIZATION
CAPACITY UTILIZATION (%)
INVENTORIES LEVELS EVOLUTION
ACTUAL-PLANNED INVENTORIES
Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17
Total
47.0
52.6
50.5
45.8
49.7
49.0
66
67
68
38.2
43.0
43.6
48.3
49.3
48.9
49.2
49.9
49.8
BY INDUSTRIAL ACTIVITY Mining and quarrying
49.1
52.2
50.7
46.9
47.2
45.6
71
72
72
43.4
44.9
45.0
50.0
44.8
50.9
46.8
46.1
46.3
Manufacturing 46.9
52.7
50.6
45.8
49.8
49.1
66
67
68
38.0
43.0
43.5
48.2
49.4
48.8
49.3
50.0
49.9
BY COMPANY SIZE Small1
45.0
50.2
48.9
44.6
48.1
48.0
60
61
61
37.0
41.3
42.1
46.9
47.9
47.3
45.1
45.8
45.3
Medium2
46.8
51.4
51.0
45.6
48.7
48.4
64
65
66
37.7
42.1
42.8
48.3
48.8
48.8
49.5
50.0
50.0
Large3
48.1
54.5
51.1
46.4
51.1
49.8
70
72
72
39.0
44.4
44.8
48.9
50.3
49.8
51.1
51.9
52.0
The indicators vary in the 0-100 interval. Figures above 50 points indicate positive evolution, higher-than-planned inventory levels, or higher-than-usual capacity utilization. 1 - Company with 10 to 49 employees. 2 - Company with 50 to 249 employees. 3 - Company with 250-plus employees.
Industry’s Expectations DEMAND
Total
EXPORTS VOLUMES
PURCHASES OF RAW MATERIALS
NUMBER OF EMPLOYEES
INVESTMENT INTENTIONS*
Dec/16
Nov/17
Dec/17
Dec/16
Nov/17
Dec/17
Dec/16
Nov/17
Dec/17
Dec/16
Nov/17
Dec/17
Dec/16
Nov/17
Dec/17
49.1
54.4
53.8
49.9
52.2
53.5
47.2
52.5
52.1
45.5
49.2
48.7
44.6
50.6
52.2
BY INDUSTRIAL ACTIVITY Mining and quarrying
44.1
48.0
49.3
54.1
52.9
54.6
42.8
50.2
49.2
44.6
46.0
47.1
46.3
52.5
51.9
Manufacturing
49.3
54.7
54.0
49.7
52.3
53.4
47.4
52.6
52.2
45.6
49.3
48.7
44.5
50.6
52.2
BY COMPANY SIZE Small1
47.0
52.3
51.8
47.1
48.8
52.8
44.7
50.2
50.0
44.6
47.9
47.7
31.7
37.9
39.4
Medium2
47.8
54.2
54.3
49.4
52.0
54.1
46.3
52.1
53.6
45.0
48.9
49.5
40.3
45.8
48.2
Large3
50.8
55.5
54.6
51.6
54.0
53.6
48.9
53.8
52.4
46.3
50.0
48.7
53.2
59.5
60.6
The indicators vary in the 0-100 interval. Figures above 50 points indicate positive expectations. * The indicator varies in the 0-100 interval. The higher the index, the more likely industry is to invest. 1 - Company with 10 to 49 employees. 2 - Company with 50 to 249 employees. 3 - Company with 250-plus employees.
Technical specifications Sample profile: 2,274 enterprises, including 936 small, 813 medium and 525 large companies. Data collection period: December 1-13, 2017.
i
Learn more For more information on the survey, including historical series and methodology, kindly visit: www.cni.org.br/e_sondindustrial
INDUSTRIAL SURVEY | English version of “Sondagem Industrial Novembro 2017” | Monthly Publication of the National Confederation of Industry - CNI | www.cni.org.br | Policy and Strategy Unit - DIRPE | Economic Policy Unit - PEC | Executive manager: Flávio Castelo Branco | Research and Competitiveness Unit - GPC | Executive manager: Renato da Fonseca | Team: Marcelo Souza Azevedo, Roxana Rossy Campos and Taryane Carvalho Perne | CNI Publishing Center | Graphic design supervision: Alisson Costa | Subscriptions: Customer Service - Phone: +55 (61) 3317-9992 – email: [email protected] | This publication may be copied, provided that the source is mentioned.
20 YEARS
INDUSTRIAL SURVEY Increased capacity utilization in industry The November issue of the Industrial Survey shows that industry remains on a recovery path. This recovery trend in industrial activity is also reflected in an increased capacity utilization, which reached 68% in November – the highest rate in almost three years. Industrial production experienced a slight increase between October and November. The index had been showing a drop in production
every November since 2013. Inventories also remain at adjusted levels. At the end of 2017, expectations are more optimistic than they were at the close of the year before. Both demand and purchases of raw materials are expected to grow. Entrepreneurs are also optimistic about foreign sales and expect number of employees to fall only moderately. Investment intentions remain on an upward trend.
Average capacity utilization Percentage (%)
76 74 72
2011
70
2012
68% Nov/17
68
2013 2014
66
2015
64
2016
62
2017
JAN
FEB
MAR
APR
MAY
JUN
JUL
1
AUG
SEP
OCT
NOV
DEC
Industrial Survey ISSN 1676-0212 • Year 20 • Number 11 • November 2017
PERFORMANCE OF INDUSTRY IN NOVEMBER 2017
Production increases in November The production index stood at 50.5 points in November. As it remained above the 50-point mark – although close to that mark – the indicator shows a slight increase in production as compared to October. Since 2013, the index had shown a decline in production in November, particularly in 2014 and 2015. In November 2017, the index hit its highest level for the month since 2011. The indicator of number of employees fell by 0.7 points to 49.0 points. As a result of this decline,
the index moved further away from the 50-point dividing line, pointing to a drop – albeit a moderate one – in employee numbers between October and November. The indices measuring production and employment range from 0 to 100 points, with figures below 50 points indicating a decline in production. The further below 50 points, the more significant and widespread the decline.
Production index for November (2010-2017) Diffusion Indices (0-100) *
52.7 Increase 50
50.5 49.8
Decrease
49.8 48.4 47.0 45.4
40.9 2010
2011
2012
2013
2014
Production
2015
2016
2017
Dividing line
* Figures above 50 points indicate a month-over-month increase in production.
Capacity utilization shows recovery The capacity utilization rate rose by one percentage point from October to November, marking the second consecutive increase in the indicator. As a result, capacity utilization reached 68%, the highest percentage for November in the last three years. Despite the increase, the figure for the month is still 6 percentage points lower than the average for November observed between 2011 (beginning of monthly series) and 2014.
2
The index measuring actual-usual capacity utilization also points to a recovery, although still shows a gap between current and expected activity levels for the month. The index rose by 0.6 points between October and November to 43.6 points, reaching its highest point since March 2014.
Industrial Survey ISSN 1676-0212 • Year 20 • Number 11 • November 2017
Inventories remain at adjusted levels Inventory remained adjusted to the levels planned by companies. The inventory index stood at 48.9 points, showing a moderate decline in inventories. The index measuring
actual-planned inventory levels in turn remained virtually on the 50-point dividing line at 49.8 points, indicating that inventories are adjusted to planned levels.
Evolution of inventories and actual-planned inventory levels Diffusion Indices (0-100) *
Increase/ above planned level
49.9
50
50.1
50.3
50.9 50.4
50.9
51.1 50.7
50.7 50.1
51.0
50.0
49.8
49.5
49.4
49.8
49.6 49.3
49.1
49.0
Decrease/ under planned 48.3 level
49.9
48.9
46.5 NOV 2016
DEC
JAN 2017
FEB
MAR
APR
Evolution
MAY
JUN
Dividing line
JUL
AUG
SEP
OCT
NOV
Actual-planned
* Figures above 50 points indicate an increase in inventories or higher-than-planned actual inventory levels.
EXPECTATIONS FOR INDUSTRY IN DECEMBER 2017
More positive expectations than at the end of 2016 While the indices of expected demand and purchases of raw materials fell from November to December, they remain above 50 points and show growth prospects.
The index measuring export volumes in turn increased by 1.3 points between November and December 2017 and reached 53.5 points, denoting optimism about foreign sales.
The index of expected number of employees fell by 0.5 points to 48.7 points. As a result, it drifted away from the 50-point mark, showing an expected decline in employment at the beginning of 2018.
Compared to December 2016, all expectations indices are significantly up, showing that the outlook for the next six months is more positive at the end of this year.
3
Industrial Survey ISSN 1676-0212 • Year 20 • Number 11 • November 2017
Expectation indices Diffusion indexes (0-100 points)
53.8 53.5 Increase 50 49.9 Decrease
52.1
49.1
48.7
47.2 45.5 DEC 2016
FEB 2017
APR
JUN
AUG
Demand
Purchases of inputs and raw materials
Number of employees Dividing line
Exports
OCT
DEC
* The index ranges from 0 to 100. Figures above 50 points indicate an expected increase over the next six months.
Investment intentions still trending upward The investment intentions index increased by 1.6 points from November and hit the mark of 52.2 points, marking the sixth consecutive monthly increase in the indicator.
The index is 7.6 points higher than that registered in December 2016 and reached its highest level since December 2014, when it stood at 52.4 points.
Investment intentions Diffusion indices (0-100 points)*
55
52.4
52.2
51
47
43
39
DEC 2014
APR 2015
AUG
DEC
APR 2016
AUG
DEC
APR 2017
* The index ranges from 0 to 100 points. The higher the index, the more likely industry is to invest.
4
AUG
DEC
Industrial Survey ISSN 1676-0212 • Year 20 • Number 11 • November 2017
RESULTS BY INDUSTRIAL ACTIVITY AND COMPANY SIZE Performance of industry NUMBER OF EMPLOYEES EVOLUTION
PRODUCTION EVOLUTION
ACTUAL-USUAL CAPACITY UTILIZATION
CAPACITY UTILIZATION (%)
INVENTORIES LEVELS EVOLUTION
ACTUAL-PLANNED INVENTORIES
Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17 Nov/16 Oct/17 Nov/17
Total
47.0
52.6
50.5
45.8
49.7
49.0
66
67
68
38.2
43.0
43.6
48.3
49.3
48.9
49.2
49.9
49.8
BY INDUSTRIAL ACTIVITY Mining and quarrying
49.1
52.2
50.7
46.9
47.2
45.6
71
72
72
43.4
44.9
45.0
50.0
44.8
50.9
46.8
46.1
46.3
Manufacturing 46.9
52.7
50.6
45.8
49.8
49.1
66
67
68
38.0
43.0
43.5
48.2
49.4
48.8
49.3
50.0
49.9
BY COMPANY SIZE Small1
45.0
50.2
48.9
44.6
48.1
48.0
60
61
61
37.0
41.3
42.1
46.9
47.9
47.3
45.1
45.8
45.3
Medium2
46.8
51.4
51.0
45.6
48.7
48.4
64
65
66
37.7
42.1
42.8
48.3
48.8
48.8
49.5
50.0
50.0
Large3
48.1
54.5
51.1
46.4
51.1
49.8
70
72
72
39.0
44.4
44.8
48.9
50.3
49.8
51.1
51.9
52.0
The indicators vary in the 0-100 interval. Figures above 50 points indicate positive evolution, higher-than-planned inventory levels, or higher-than-usual capacity utilization. 1 - Company with 10 to 49 employees. 2 - Company with 50 to 249 employees. 3 - Company with 250-plus employees.
Industry’s Expectations DEMAND
Total
EXPORTS VOLUMES
PURCHASES OF RAW MATERIALS
NUMBER OF EMPLOYEES
INVESTMENT INTENTIONS*
Dec/16
Nov/17
Dec/17
Dec/16
Nov/17
Dec/17
Dec/16
Nov/17
Dec/17
Dec/16
Nov/17
Dec/17
Dec/16
Nov/17
Dec/17
49.1
54.4
53.8
49.9
52.2
53.5
47.2
52.5
52.1
45.5
49.2
48.7
44.6
50.6
52.2
BY INDUSTRIAL ACTIVITY Mining and quarrying
44.1
48.0
49.3
54.1
52.9
54.6
42.8
50.2
49.2
44.6
46.0
47.1
46.3
52.5
51.9
Manufacturing
49.3
54.7
54.0
49.7
52.3
53.4
47.4
52.6
52.2
45.6
49.3
48.7
44.5
50.6
52.2
BY COMPANY SIZE Small1
47.0
52.3
51.8
47.1
48.8
52.8
44.7
50.2
50.0
44.6
47.9
47.7
31.7
37.9
39.4
Medium2
47.8
54.2
54.3
49.4
52.0
54.1
46.3
52.1
53.6
45.0
48.9
49.5
40.3
45.8
48.2
Large3
50.8
55.5
54.6
51.6
54.0
53.6
48.9
53.8
52.4
46.3
50.0
48.7
53.2
59.5
60.6
The indicators vary in the 0-100 interval. Figures above 50 points indicate positive expectations. * The indicator varies in the 0-100 interval. The higher the index, the more likely industry is to invest. 1 - Company with 10 to 49 employees. 2 - Company with 50 to 249 employees. 3 - Company with 250-plus employees.
Technical specifications Sample profile: 2,274 enterprises, including 936 small, 813 medium and 525 large companies. Data collection period: December 1-13, 2017.
i
Learn more For more information on the survey, including historical series and methodology, kindly visit: www.cni.org.br/e_sondindustrial
INDUSTRIAL SURVEY | English version of “Sondagem Industrial Novembro 2017” | Monthly Publication of the National Confederation of Industry - CNI | www.cni.org.br | Policy and Strategy Unit - DIRPE | Economic Policy Unit - PEC | Executive manager: Flávio Castelo Branco | Research and Competitiveness Unit - GPC | Executive manager: Renato da Fonseca | Team: Marcelo Souza Azevedo, Roxana Rossy Campos and Taryane Carvalho Perne | CNI Publishing Center | Graphic design supervision: Alisson Costa | Subscriptions: Customer Service - Phone: +55 (61) 3317-9992 – email: [email protected] | This publication may be copied, provided that the source is mentioned.
