Key Metrics and Supply Alert
Staff -- Purchasing, 5/1/2003
- Three-month buying intentions edged up last month, an early signal that business will improve as the conflict with Iraq subsides and energy tags drop. Forty-nine percent of buyers responding to last month's Business Survey conducted by PURCHASING magazine say they plan to increase spend levels three months out. That's up from 34% last October. The biggest push is coming from the electronics- and metals-consuming segments. Weakest is the chemicals-consuming segment, which was crushed by soaring monomer costs. Regionally, the West Coast is showing the most anticipated buying growth. Get the latest business data at www.purchasingdata.com.
- Outlook for economic growth suddenly seems a little brighter. Some economic mavens say an annual growth rate of 3% or more may be reached by the end of this year. Factors fueling growth will be low inflation and interest rates. Purchasing's data, however, still show no signs of light in tooling, capital equipment or computer buying. Business profits are forecast to grow 8% this year, up 0.4% from 2002.
- Fastest-growing world economy this year will be China, with a 7% gain in gross domestic product. Experts forecast China's growth to move up 8% in 2004. Global GDP is expected to be a weak 2% this year. The European economies collectively will move up less than 1% this year.
- Polyethylene producers dropped energy surcharges last month, creating hope that even the chemicals sector will feel relief when feedstock costs stabilize. The surcharge, in effect only in March, was posted because of soaring spot prices for natural gas. PE monomers are often made from gas feedstocks.
- Expect natural fibers to continue to replace glass as reinforcements in polyurethane. The big driver is the effort to reduce part weights in automotive applications. Some manufacturers also view natural fibers as a reduced health and safety risk. A new natural fiber system from Bayer Polymers is said to reduce weight as much as 45% compared to equivalent parts from conventional injection molding materials.
- Find out what it takes to be recognized as the very best. In September, PURCHASING will announce the 2002 winner of its coveted Medal of Professional Excellence. Stories on past winners are compiled in two volumes: The Book of Winners and The Book of Winners 2nd Edition. Both can be ordered through the bookstore at www.purchasing.com.
| Up | Down | Same | Index | Trend | ||
| Business Activity Indexes* | ||||||
| National | 39% | 29% | 32% | 55.0 | Up | |
| Northeast*** | 41% | 25% | 34% | 58.4 | Down | |
| Midwest | 32% | 32% | 36% | 50.4 | Down | |
| South | 42% | 32% | 26% | 55.3 | Down | |
| West | 45% | 28% | 27% | 58.9 | Up | |
| Forward Demand Indexes* (90-days) | ||||||
| National | 49% | 26% | 25% | 61.5 | Up | |
| Northeast*** | 49% | 29% | 22% | 49.7 | Down | |
| Midwest | 49% | 26% | 25% | 61.2 | Down | |
| South | 49% | 28% | 23% | 60.1 | Up | |
| West | 51% | 18% | 31% | 66.3 | Up | |
| Latest | Mo ago | Yr ago | ROC** | Trend | ||
| Leadtime Index ('92=100) | 103.1 | 131.7 | 80.4 | 24.5% | Down | |
| Industrial Supplies Price Index ('92=100) | 143.4 | 150.4 | 109.3 | 9.3% | Down | |
| *Percent of buyers responding to survey/diffusion indexes. Above 50=rising, below 50=falling. **12-month rate of change. ***Now includes states formerly designated at Middle Atlantic. SOURCE: PURCHASING | ||||||
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