Factory output hits three-month high

The Philippine Statistics Auto Authority (PSA) reported that local factory output growth reached its highest level in three months, propelled by the expansion in food products, transport equipment, and other non-metallic minerals. Based on the preliminary results of the PSA Monthly Integrated Survey of Selected Industries (MISSI), the volume of production index (VoPI) rose by 8.2 percent in April, a reversal of the 1.3 percent contraction registered in the same month last year. April VoPI growth was also the highest in three months, or since the 10.4 percent expansion in January. MISSI is a study conducted by the PSA that aims to provide timely and relevant information about the performance of growth-oriented industries. The survey gathers data from manufacturing establishments that belong to the top 500 corporations in the country, serving as an indicator of the manufacturing sector's overall health. PSA data showed that the top three divisions that significantly contributed to the annual increase in manufacturing output were the manufacture of food products, which recorded a substantial growth rate of 14.7 percent. This was followed by transport equipment, which saw a robust growth rate of 38 percent, and other non-metallic mineral products with a growth rate of 15.7 percent. In addition to these top performers, growth was also observed in other sectors, such as printing and reproduction of recorded media, which surged by 50.5 percent, basic metals by 29.3 percent, repair and installation of machinery and equipment at 27.1 percent. Electrical equipment also grew by 19 percent, while wood, bamboo, cane, and rattan, showed a growth rate of 16.9 percent. The sector of coke and refined petroleum also saw a growth rate of 15.3 percent. Meanwhile, the manufacturing sectors that saw significant contractions were the manufacture of wearing apparel, which took the hardest hit at -35.6 percent, followed by chemical and chemical products with -30.4 percent. Likewise, furniture dropped 21.5 percent, tobacco products with -19.1 percent, and computer, electronic, and optical products with -13.5 percent. The average capacity utilization rate for the month was recorded at 72.4 percent, slightly lower than the previous month's rate of 73.2 percent. Among manufacturing establishments, 24 percent operated at full capacity, while 38.1 percent operated at below 70 percent capacity. On the other hand, the value of production index (VaPI) grew by 10.7 percent in April, marking a significant improvement compared to the growth rate of six percent in March and five percent in April 2022. Last June 1, S&P Global also reported that factory activity in the country expanded further amid a quicker improvement in operating conditions of manufacturers following an eight-month low growth in April, The Philippines’ S&P Global manufacturing purchasing managers' index (PMI), a composite single-figure indicator of manufacturing performance, rose to 52.2 in May from 51.4 in the previous month. According to S&P Global, the latest headline figure extended the current run of expansion to 16 consecutive months and posted above the average recorded over the series history to indicate a solid upturn. S&P Global attributed the robust growth to better operating conditions across the goods-producing sector in the country.