Industry still facing difficulties
CNI Indicators ISSN 1676-0212 • Year 19 • Number 10 • October 2016
INDUSTRIAL SURVEY Industry still facing difficulties Industrial production, which usually grows in October, kept falling at the same rate observed last month and remains at a significantly low level, leading to high idleness in the industrial park. Capacity utilization dropped a further percentage point to 65% and is once again down as compared to 2015, a year of weak industrial activity. Compared with the same month in 2011 and 2013, the index is down by 10 percentage points.
Moreover, business expectations took a more pessimistic turn in November, with all indicators experiencing a decline. Entrepreneurs, who were optimistic about demand over the next six months, are now expecting demand for their products to hold steady. Exports are also not projected to increase. Prospects for purchases of raw materials and number of employees over the next six months point to a decline.
Production index in October (2010-2016) Diffusion indices (0-100)
54.9
54.5
52.7 Increase 50
50.8
Decrease
48.8 45.8 44.6
2010
2011
2012
2013
Production
2014
2015
2016
Dividing line
The index varies in the 0-100 interval. Figures above 50 points indicate a month-over-month increase in production.
1
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
PERFORMANCE OF INDUSTRY IN OCTOBER 2016
Production and employment keep falling The production index stood at 45.8 points in October, showing a month-over-month decline in the indicator. The index is up from 2015 levels, but down as compared to previous years. In 2010 and from 2012 to 2014, the index had exceeded the 50-point mark. The indicator of number of employees fell by 0.7 points in October to 45.8 points, remaining below the 50-point dividing line. Still, the index is 3.6
points higher than that observed in the same month in 2015, suggesting that jobs have fallen at a slower pace. The indicators of production and number of employees range from 0 to 100 points, with readings below 50 indicating a decline in production and/or number of employees. The further below 50 points, the more significant and widespread the drop.
Index of number of employees in October (2011-2016) Diffusion indices (0-100 points)
Increase 50 Decrease
50.2 49.9 49.2 47.1 45.8
42.2 2011
2012
2013
Number of employees
2014
2015
2016
Dividing line
The indicator varies in the 0-100 interval. Figures above 50 points values indicate a month-over-month increase in number of employees.
Capacity utilization falls below 2015 levels The average capacity utilization rate, which held steady at 66% in the last two months, fell by 1.0 percentage point in October to 65%. The indicator is also down by 1.0 percentage point from that recorded in October 2015 and by 10 percentage points from the same month in 2011 and 2013. The index of actual-usual capacity utilization hovered within the margin of error in October, down by 0.3 points from September to 36.8
2
points. The index is 13.2 points shy of the 50-point dividing line. Despite the decline, the indicator is up by 2.3 points from October last year, when it reached 34.5 points. The index of actual-usual capacity utilization ranges from 0 to 100, with readings below 50 indicating lower-than-usual capacity utilization for the month. The further below 50 points, the more capacity utilization is below usual levels.
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
Average capacity utilization rate Percentage (%)
76 74 72
2011
70
2012 2013
68
2014
66
2015
65% Oct/16
64
2016
62
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
Inventories at adjusted levels Inventories remained unchanged in October, with the inventory index hitting the mark of 49.9 points – virtually on the dividing line. Inventory remained adjusted to planned levels, as shown by the index of actual-usual inventory levels, which is also close to the dividing line.
The indices of inventory and actual-usual inventory levels range from 0 to 100, with figures above 50 indicating an increase in inventories or higherthan-planned inventory levels for the month.
Index of inventory levels and actual-planned inventory levels Diffusion index (0-100)
Increase/ above planned level 50.8
50.8 49.8
50
49.3
49.8
50.6 49.6
50.4
49.7
49.9 49.7
48.9
48.7
Decrease/ under planned level
48.4
48.9
48.9
48.9
48.2 47.8
46.6 SEP 2015
OCT
NOV
DEC
JAN FEB 2016
Evolution
MAR
APR
MAY
Dividing line
JUN
JUL
AUG
SEP
OCT
Actual-planned
The inventory indicator varies in the 0-100 interval. Figures above 50 points indicate an increase in inventory levels. The indicator of actual-planned inventory levels varies in the 0-100 interval. Figures above 50 points indicate that actual inventory is above planned levels.
3
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
INDUSTRY’S EXPECTATIONS IN NOVEMBER 2016
Entrepreneurs review their expectations Entrepreneurs reevaluated their expectations in November. After holding steady in October, all expectations indices fell in November. The index of expected demand shrank from 52.3 points to 49.9 points, standing virtually on the 50-point dividing line. That is to say that entrepreneurs, who were slightly optimistic about demand over the next six months, are now expecting demand for their products to remain stable. The index of expected export volumes recorded a 1.2-point decline, down from 50.8 points to 49.6
points. Despite the decline, the index remained close to the dividing line, suggesting an expected stability. In line with falling demand, the index of purchases of raw materials edged down by 2.2 points and drifted away from the dividing line. At 47.5 points, the index indicates an expected decline in purchases. The index of expected number of employees fell by 0.6 points, fluctuating within the margin of error for the index. The indicator stood at 45.4 points, reflecting an expected drop in employment.
Expectations indices Diffusion index (0-100 points)
Export volumes and demand
Increase
49.9 49.6
50
Decrease
Export volumes Demand NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV 2015 2016
Dividing line
The index ranges from 0 to 100. Figures above 50 points indicate an expected increase over the next six months.
Purchases of raw materials and number of employees
Increase 50
Decrease
47.5 45.4 Purchases of raw materials Number of employees NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV 2015 2016 The index ranges from 0 to 100. Figures above 50 points indicate an expected increase over the next six months.
4
Dividing line
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
Investment intentions show no reaction The investment intentions index hovered within the margin of error in November, growing by 0.4 points to 43.9 points.
Investment intentions
Albeit still at a low level – 3.7 points shy of its historical average – the index has not declined in seven months. Compared with November 2015, the index grew by 3.1 points.
60
Diffusion indices (0-100 points)
65
55 50
43.9 45 40
NOV FEB MAY AUG NOV FEB MAY AUG NOV FEB MAY AUG NOV 2013 2014 2015 2016 The index ranges from 0 to 100 points. The higher the index, the more likely industry is to invest.
RESULTS BY INDUSTRIAL ACTIVITY AND COMPANY SIZE Performance of industry PRODUCTION EVOLUTION
NUMBER OF EMPLOYEES EVOLUTION
CAPACITY UTILIZATION (%)
ACTUAL-USUAL CAPACITY UTILIZATION
INVENTORIES LEVELS EVOLUTION
ACTUAL-PLANNED INVENTORIES
Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16
Total
44.6
45.8
45.8
42.2
46.5
45.8
66
66
65
34.5
37.1
36.8
50.8
49.7
49.9
52.0
49.6
50.6
BY INDUSTRIAL ACTIVITY Mining and quarrying
44.5
47.1
46.8
42.3
44.3
46.1
71
70
71
39.0
39.5
40.5
45.4
51.2
50.0
45.9
47.2
45.9
Manufacturing 44.6
45.8
45.8
42.2
46.6
45.8
66
66
65
34.3
37.0
36.7
51.0
49.7
50.0
52.3
49.6
50.8
BY COMPANY SIZE Small1
40.1
43.6
42.9
41.2
44.6
44.8
60
59
59
33.0
35.8
35.4
45.6
45.8
45.8
46.2
44.4
44.4
Medium2
43.5
45.4
44.8
41.6
45.4
45.4
64
63
63
33.8
35.7
35.8
49.4
48.4
50.0
50.8
49.6
49.9
Large3
47.4
47.2
47.7
43.0
48.1
46.6
71
71
70
35.6
38.5
38.1
54.2
52.4
51.9
55.6
52.1
54.0
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.
5
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
DEMAND
Total
EXPORTS VOLUMES
PURCHASES OF RAW MATERIALS
NUMBER OF EMPLOYEES
INVESTMENT INTENTIONS*
Nov/15
Oct/16
Nov/16
Nov/15
Oct/16
Nov/16
Nov/15
Oct/16
Nov/16
Nov/15
Oct/16
Nov/16
Nov/15
Oct/16
Nov/16
43.5
52.3
49.9
50.6
50.8
49.6
41.4
49.7
47.5
40.5
46.0
45.4
40.8
43.5
43.9
BY INDUSTRIAL ACTIVITY Mining and quarrying
42.7
48.2
43.4
44.0
48.8
44.0
40.7
45.6
42.7
40.1
42.3
43.8
44.8
41.1
49.3
Manufacturing
43.6
52.5
50.2
50.9
51.0
49.9
41.5
49.8
47.8
40.5
46.1
45.5
40.6
43.6
43.7
BY COMPANY SIZE Small1
41.1
50.1
48.4
45.3
47.5
47.8
40.0
48.1
46.2
39.8
45.3
45.0
29.5
31.6
32.5
Medium2
42.9
51.7
49.6
51.7
50.5
48.5
41.3
49.5
48.5
40.5
46.1
45.5
35.5
37.8
40.2
Large3
45.1
53.7
50.8
52.6
52.5
51.1
42.2
50.5
47.7
40.9
46.3
45.6
49.2
52.4
51.5
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.
i
Learn more
Technical specifications
For more information on the survey, including historical series and methodology, kindly visit: www.cni.org.br/e_sondindustrial
Sample profile: 2,371 enterprises, including 979 small, 862 medium and 530 large companies. Data collection period: November 1-11, 2016.
INDUSTRIAL SURVEY | English version of “Sondagem Industrial outubro 2016” | 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.
INDUSTRIAL SURVEY Industry still facing difficulties Industrial production, which usually grows in October, kept falling at the same rate observed last month and remains at a significantly low level, leading to high idleness in the industrial park. Capacity utilization dropped a further percentage point to 65% and is once again down as compared to 2015, a year of weak industrial activity. Compared with the same month in 2011 and 2013, the index is down by 10 percentage points.
Moreover, business expectations took a more pessimistic turn in November, with all indicators experiencing a decline. Entrepreneurs, who were optimistic about demand over the next six months, are now expecting demand for their products to hold steady. Exports are also not projected to increase. Prospects for purchases of raw materials and number of employees over the next six months point to a decline.
Production index in October (2010-2016) Diffusion indices (0-100)
54.9
54.5
52.7 Increase 50
50.8
Decrease
48.8 45.8 44.6
2010
2011
2012
2013
Production
2014
2015
2016
Dividing line
The index varies in the 0-100 interval. Figures above 50 points indicate a month-over-month increase in production.
1
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
PERFORMANCE OF INDUSTRY IN OCTOBER 2016
Production and employment keep falling The production index stood at 45.8 points in October, showing a month-over-month decline in the indicator. The index is up from 2015 levels, but down as compared to previous years. In 2010 and from 2012 to 2014, the index had exceeded the 50-point mark. The indicator of number of employees fell by 0.7 points in October to 45.8 points, remaining below the 50-point dividing line. Still, the index is 3.6
points higher than that observed in the same month in 2015, suggesting that jobs have fallen at a slower pace. The indicators of production and number of employees range from 0 to 100 points, with readings below 50 indicating a decline in production and/or number of employees. The further below 50 points, the more significant and widespread the drop.
Index of number of employees in October (2011-2016) Diffusion indices (0-100 points)
Increase 50 Decrease
50.2 49.9 49.2 47.1 45.8
42.2 2011
2012
2013
Number of employees
2014
2015
2016
Dividing line
The indicator varies in the 0-100 interval. Figures above 50 points values indicate a month-over-month increase in number of employees.
Capacity utilization falls below 2015 levels The average capacity utilization rate, which held steady at 66% in the last two months, fell by 1.0 percentage point in October to 65%. The indicator is also down by 1.0 percentage point from that recorded in October 2015 and by 10 percentage points from the same month in 2011 and 2013. The index of actual-usual capacity utilization hovered within the margin of error in October, down by 0.3 points from September to 36.8
2
points. The index is 13.2 points shy of the 50-point dividing line. Despite the decline, the indicator is up by 2.3 points from October last year, when it reached 34.5 points. The index of actual-usual capacity utilization ranges from 0 to 100, with readings below 50 indicating lower-than-usual capacity utilization for the month. The further below 50 points, the more capacity utilization is below usual levels.
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
Average capacity utilization rate Percentage (%)
76 74 72
2011
70
2012 2013
68
2014
66
2015
65% Oct/16
64
2016
62
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
Inventories at adjusted levels Inventories remained unchanged in October, with the inventory index hitting the mark of 49.9 points – virtually on the dividing line. Inventory remained adjusted to planned levels, as shown by the index of actual-usual inventory levels, which is also close to the dividing line.
The indices of inventory and actual-usual inventory levels range from 0 to 100, with figures above 50 indicating an increase in inventories or higherthan-planned inventory levels for the month.
Index of inventory levels and actual-planned inventory levels Diffusion index (0-100)
Increase/ above planned level 50.8
50.8 49.8
50
49.3
49.8
50.6 49.6
50.4
49.7
49.9 49.7
48.9
48.7
Decrease/ under planned level
48.4
48.9
48.9
48.9
48.2 47.8
46.6 SEP 2015
OCT
NOV
DEC
JAN FEB 2016
Evolution
MAR
APR
MAY
Dividing line
JUN
JUL
AUG
SEP
OCT
Actual-planned
The inventory indicator varies in the 0-100 interval. Figures above 50 points indicate an increase in inventory levels. The indicator of actual-planned inventory levels varies in the 0-100 interval. Figures above 50 points indicate that actual inventory is above planned levels.
3
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
INDUSTRY’S EXPECTATIONS IN NOVEMBER 2016
Entrepreneurs review their expectations Entrepreneurs reevaluated their expectations in November. After holding steady in October, all expectations indices fell in November. The index of expected demand shrank from 52.3 points to 49.9 points, standing virtually on the 50-point dividing line. That is to say that entrepreneurs, who were slightly optimistic about demand over the next six months, are now expecting demand for their products to remain stable. The index of expected export volumes recorded a 1.2-point decline, down from 50.8 points to 49.6
points. Despite the decline, the index remained close to the dividing line, suggesting an expected stability. In line with falling demand, the index of purchases of raw materials edged down by 2.2 points and drifted away from the dividing line. At 47.5 points, the index indicates an expected decline in purchases. The index of expected number of employees fell by 0.6 points, fluctuating within the margin of error for the index. The indicator stood at 45.4 points, reflecting an expected drop in employment.
Expectations indices Diffusion index (0-100 points)
Export volumes and demand
Increase
49.9 49.6
50
Decrease
Export volumes Demand NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV 2015 2016
Dividing line
The index ranges from 0 to 100. Figures above 50 points indicate an expected increase over the next six months.
Purchases of raw materials and number of employees
Increase 50
Decrease
47.5 45.4 Purchases of raw materials Number of employees NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV 2015 2016 The index ranges from 0 to 100. Figures above 50 points indicate an expected increase over the next six months.
4
Dividing line
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
Investment intentions show no reaction The investment intentions index hovered within the margin of error in November, growing by 0.4 points to 43.9 points.
Investment intentions
Albeit still at a low level – 3.7 points shy of its historical average – the index has not declined in seven months. Compared with November 2015, the index grew by 3.1 points.
60
Diffusion indices (0-100 points)
65
55 50
43.9 45 40
NOV FEB MAY AUG NOV FEB MAY AUG NOV FEB MAY AUG NOV 2013 2014 2015 2016 The index ranges from 0 to 100 points. The higher the index, the more likely industry is to invest.
RESULTS BY INDUSTRIAL ACTIVITY AND COMPANY SIZE Performance of industry PRODUCTION EVOLUTION
NUMBER OF EMPLOYEES EVOLUTION
CAPACITY UTILIZATION (%)
ACTUAL-USUAL CAPACITY UTILIZATION
INVENTORIES LEVELS EVOLUTION
ACTUAL-PLANNED INVENTORIES
Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16 Oct/15 Sep/16 Oct/16
Total
44.6
45.8
45.8
42.2
46.5
45.8
66
66
65
34.5
37.1
36.8
50.8
49.7
49.9
52.0
49.6
50.6
BY INDUSTRIAL ACTIVITY Mining and quarrying
44.5
47.1
46.8
42.3
44.3
46.1
71
70
71
39.0
39.5
40.5
45.4
51.2
50.0
45.9
47.2
45.9
Manufacturing 44.6
45.8
45.8
42.2
46.6
45.8
66
66
65
34.3
37.0
36.7
51.0
49.7
50.0
52.3
49.6
50.8
BY COMPANY SIZE Small1
40.1
43.6
42.9
41.2
44.6
44.8
60
59
59
33.0
35.8
35.4
45.6
45.8
45.8
46.2
44.4
44.4
Medium2
43.5
45.4
44.8
41.6
45.4
45.4
64
63
63
33.8
35.7
35.8
49.4
48.4
50.0
50.8
49.6
49.9
Large3
47.4
47.2
47.7
43.0
48.1
46.6
71
71
70
35.6
38.5
38.1
54.2
52.4
51.9
55.6
52.1
54.0
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.
5
Industrial Survey ISSN 1676-0212 • Year 19 • Number 10 • October 2016
DEMAND
Total
EXPORTS VOLUMES
PURCHASES OF RAW MATERIALS
NUMBER OF EMPLOYEES
INVESTMENT INTENTIONS*
Nov/15
Oct/16
Nov/16
Nov/15
Oct/16
Nov/16
Nov/15
Oct/16
Nov/16
Nov/15
Oct/16
Nov/16
Nov/15
Oct/16
Nov/16
43.5
52.3
49.9
50.6
50.8
49.6
41.4
49.7
47.5
40.5
46.0
45.4
40.8
43.5
43.9
BY INDUSTRIAL ACTIVITY Mining and quarrying
42.7
48.2
43.4
44.0
48.8
44.0
40.7
45.6
42.7
40.1
42.3
43.8
44.8
41.1
49.3
Manufacturing
43.6
52.5
50.2
50.9
51.0
49.9
41.5
49.8
47.8
40.5
46.1
45.5
40.6
43.6
43.7
BY COMPANY SIZE Small1
41.1
50.1
48.4
45.3
47.5
47.8
40.0
48.1
46.2
39.8
45.3
45.0
29.5
31.6
32.5
Medium2
42.9
51.7
49.6
51.7
50.5
48.5
41.3
49.5
48.5
40.5
46.1
45.5
35.5
37.8
40.2
Large3
45.1
53.7
50.8
52.6
52.5
51.1
42.2
50.5
47.7
40.9
46.3
45.6
49.2
52.4
51.5
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.
i
Learn more
Technical specifications
For more information on the survey, including historical series and methodology, kindly visit: www.cni.org.br/e_sondindustrial
Sample profile: 2,371 enterprises, including 979 small, 862 medium and 530 large companies. Data collection period: November 1-11, 2016.
INDUSTRIAL SURVEY | English version of “Sondagem Industrial outubro 2016” | 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.
