Australia’s manufacturing industry entered 2018 in good health after completing a year of continuous month-on-month growth.
Further building on the recovery the sector has experienced over the year, the Australian Industry Group Australian Performance of Manufacturing Index (Australian PMI) recorded a reading of 56.2 in December – down a slight 1.1 on the previous month.
All seven activity sub-indexes in the Australian PMI expanded in December, with production, stocks (inventories) and supplier deliveries growing at an accelerated pace while new orders, employment, exports and sales all moderated.
Six of the eight manufacturing sub-sectors also expanded, led by the very large food and beverages sector which recorded its highest monthly result since April 2016 (63.2 points).
While still expanding, the non-metallic mineral products (55.7 points) and machinery and equipment (55.4 points) sub-sectors both recorded their lowest index results for 2017 in December, as did wood & paper products, which slipped 3.5 points to move back into contraction (47.2 points).
“December marked the 15th consecutive month of expanding or stable conditions in the manufacturing sector and adds to the confidence and momentum that has been building over the past year,” said AI Group CEO Innes Willox.
“The healthy Australian PMI reading of 56.2 is all the more impressive given the headwinds of the closure of auto assembly, high energy prices and growing skills shortages which have marked 2017.
“Manufacturers will be looking to the new year for the progress on the National Energy Guarantee and other measures to put downward pressure on business costs.”