Manufacturers again less confident

© Hollandse Hoogte
According to Statistics Netherlands (CBS), confidence among Dutch manufacturers stood at 8.2 in April, down from 9.5 in March. Confidence deteriorated for the second consecutive month. However, the confidence indicator remains well above its long-term average over the past two decades (0.8). In April, manufacturers were again less positive about their future output than in the previous month.

Business confidence reached an all-time high (10.9) in February 2018 and an all-time low (-23.5) in February 2009. Since October 2014, optimism has prevailed among Dutch manufacturers.

Producer confidence manufacturing industry (seasonally adjusted) (average of the component questions)
2014 M0.7
2014 J0.7
2014 J1.2
2014 A0
2014 S-0.2
2014 O2
2014 N2.4
2014 D3.4
2015 J2.8
2015 F2
2015 M1.4
2015 A3.3
2015 M4.1
2015 J4.6
2015 J3.7
2015 A3.5
2015 S3.8
2015 O2.4
2015 N4
2015 D3
2016 J3.2
2016 F3.1
2016 M3.9
2016 A4.7
2016 M4.4
2016 J5.4
2016 J5.1
2016 A1.2
2016 S3.4
2016 O4.3
2016 N3.4
2016 D4.7
2017 J6
2017 F7
2017 M7.8
2017 A8.3
2017 M6.1
2017 J7.2
2017 J6.6
2017 A5.4
2017 S8.5
2017 O8.2
2017 N9.1
2017 D8.9
2018 J10.3
2018 F10.9
2018 M9.5
2018 A8.2

Less positive about future output

In April, Dutch manufacturers were less positive about their future output than one month previously. They were also less positive about the stocks of finished products. However, their mood about the order books improved.

All component indicators of producer confidence have been positive for over a year now. Manufacturers anticipating output growth over the next three months outnumber those expecting output decline. More manufacturers consider the number of received orders to be large rather than small, given the time of year. There are also more manufacturers who define their stocks of finished products as too small rather than too large.

Producers in the wood and building materials industry most positive

For more than one year now, optimism has prevailed across all subsectors of the manufacturing industry. Producers in the wood and building materials industry were most positive in April. Manufacturers in the metal, electrotechnical, machinery, food and petroleum industries were less positive than in the previous month.

Producer confidence by sector (seasonally adjusted), April 2018 (average of the component indicators)
Wood and
Paper and printing10.7
Electrotechnical products
and machinery

Industrial capacity utilisation rate at highest level since 2008

At the beginning of Q2 2018, the industrial capacity utilisation rate stood at 83.6 percent. This is the highest level of the capacity utilisation rate in over a decade.
Manufacturers’ expectations in April about the future workforce remained the same as in March, when expectations were the highest in 28 years.

Capacity utilisation rate, first month of the quarter (%)
 Capacity utilisation rate
2014 III79.7
2014 IV80.3
2015 I80.4
2015 II81.8
2015 III82.3
2015 IV82.3
2016 I81.2
2016 II81.5
2016 III81.7
2016 IV82.2
2017 I81.3
2017 II82.8
2017 III83.4
2017 IV83.3
2018 I83.5
2018 II83.6

Manufacturing output over 4 percent up in February

The average daily output generated by the Dutch manufacturing industry was 4.2 percent up in February compared to the same month last year. The growth rate was lower than in January, when the highest increase in almost 7 years was achieved. For over two years now, manufacturing output has continually been above the level of the same period year-on-year. The strongest growth in February 2018 was seen in the pharmaceutical industry.

German manufacturers also less positive

Germany is an important foreign market for the Dutch manufacturing industry. Confidence (i.e. the IFO index) dropped in April for the third consecutive month. The average daily output generated by the German manufacturing industry was almost 3 percent higher in February 2018 than one year previously.

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