The UK’s manufacturers have seen an improvement in total and export orders in December, but still expect their output to contract mildly over the coming three months.
That’s according to the latest CBI Industrial Trends Survey.
The survey of 473 manufacturers saw the strongest total orders for three months and exports performed better when compared with recent months – with 14 out of 18 sub-sectors improving; but exports remained a drag on overall orders.
Manufacturing output edged down a little with the expectation of a further small fall over the coming quarter. Average prices are expected to remain flat over the next quarter.
CBI’s director of economics, Rain Newton-Smith commented: “Manufacturers are still having a tough time of it with output slipping and exports remaining a weak spot in spite of an improvement at the end of the year.
“But there is a pick-up in orders from previous months which could be a sign of light at the end of the tunnel.
“The UK’s export performance has lagged for too long now and that’s why business wants to see an independent Exports Commission bringing together politicians and exporters to make some genuine progress on turning the situation around.”
The CBI recently launched Best in Class with proposals aimed at improving the UK’s export performance, including creating an independent Exports Commission.
The report also compares the policies and structures that other countries – from the US and Singapore, to Sweden and Germany – have implemented to improve their exporting track record.
- 25% of firms said their total order books were below normal, 17% said they were above, giving a rounded balance of -7% (against an average score of -15%). Manufacturers had reported a balance of -11% in November
- 31% said export orders were below normal, 13% said they were above, giving a balance of -18% (November’s survey reported -29%)
- Average prices at which manufacturers expect to book domestic orders over the next three months are expected to fall, according to 13% of respondents while 11% expect them to rise. The balance of -2% is a repeat of November’s figure.
- Asked about output volumes over the past three months, 24% said they had risen, 27% said they had fallen, producing a balance of -3% (+4% in November)
- Over the next three months, 19% expect output volumes to rise, 24% to fall, giving a balance of -5% – similar to last month’s expectation (-6%)
- A balance of +10% of respondents said that their stocks of finished goods were more than adequate to meet demand (+6% in November)