Producer confidence down in March

© Hollandse Hoogte / Cultura Images RF
According to Statistics Netherlands (CBS), producer confidence among Dutch manufacturers has deteriorated in March 2020 to the lowest level since October 2014. Confidence stands at 0.2 in March, down from 3.7 in February. In March, manufacturers are mainly more negative about their future output.

Producer confidence is derived from the Netherlands Business Survey (COEN). Approximately 90 percent of the respondents participating in this survey had already responded to the survey before the far-reaching measures against the spread of coronavirus came into effect on Thursday 12 March. As a result, the effects of these measures are not yet fully reflected in the producer confidence measurements for March. Confidence had already deteriorated in the response until 12 March confidence, but the decline was much stronger afterwards.  

The long-term average over the past two decades is 0.9. Producer confidence reached an all-time high (10.9) in February 2018 and an all-time low (-23.5) in February 2009. Optimism has prevailed among Dutch manufacturers since October 2014.

Producer confidence manufacturing industry (seasonally adjusted)
yearmonthbalance (average of the component questions)
2016April4.7
2016May4.4
2016June5.4
2016July5.1
2016August1.2
2016September3.4
2016October4.3
2016November3.4
2016December4.7
2017January6
2017February7
2017March7.8
2017April8.3
2017May6.1
2017June7.2
2017July6.6
2017August5.4
2017September8.5
2017October8.2
2017November9.1
2017December8.9
2018January10.3
2018February10.9
2018March9.5
2018April8.2
2018May9.8
2018June7.7
2018July6.3
2018August5.9
2018September5.7
2018October5.9
2018November7.2
2018December7.5
2019January5.8
2019February6.3
2019March6.1
2019April6.7
2019May4.7
2019Juni3.3
2019Juli 3.9
2019August3.9
2019September3.3
2019October3.6
2019November2.8
2019December2.9
2020January2.5
2020February3.7
2020March0.2

More negative about future output

In March, Dutch manufacturers are considerably more negative about their future output. Their opinions on stocks of finished products have also slightly deteriorated. However, manufactures are more positive about their order position.

Two component indicators of producer confidence are positive. More manufacturers consider their order position to be strong rather than weak, given the time of year. There are more manufacturers who define their current stocks of finished products as too small rather than too large.

One component indicator, future output, is negative. Manufacturers who anticipate output decline over the next three months outnumber those expecting output growth.

Future output (seasonally adjusted)
jaarmaandsaldo (balance % positive and % negative answers)
2016april5.4
2016mei3.3
2016juni4.1
2016juli3.8
2016augustus-1
2016september3.4
2016oktober8.7
2016november4.9
2016december5.9
2017januari6.2
2017februari8.3
2017maart9.7
2017april9.8
2017mei6.1
2017juni7.1
2017juli6
2017augustus4.9
2017september12.2
2017oktober9.8
2017november9.6
2017december7.4
2018januari13.3
2018februari16
2018maart12.6
2018april9
2018mei13.3
2018juni8.3
2018juli5
2018augustus4.3
2018september3.3
2018oktober5.2
2018november6.7
2018december10
2019januari5.6
2019februari3.6
2019maart2.8
2019april3.3
2019mei0.9
2019juni-1.2
2019juli-0.1
2019augustus2
2019september2
2019oktober3.1
2019november1.4
2019december0.4
2020januari1.8
2020februari3.1
2020maart-8

Producer confidence down in all sectors

In March, producer confidence has deteriorated in all sectors. Producers in the textiles, clothes and leather industry have the most optimistic outlook. Producer confidence in the electrotechnical industry, the food, beverages and tobacco industry and the transport equipment industry was negative.

Producer confidence by sector (seasonally adjusted)
 March 2020 (average of the component questions)February 2020 (average of the component questions)
Textiles, clothes, leather10.116.1
Paper and printing58.6
Petroleum2.14.9
Timber and building materials1.56.8
Metal0.74.6
Electrotechnical products and machinery-0.72.3
Food, beverages, tobacco-2.33.3
Transport equipment-4.2-1.2

Manufacturing output 0.3 percent up in January

In January 2020, the average daily output generated by the Dutch manufacturing industry was 0.3 percent up on one year previously. Output showed a year-on-year decline in the preceding two months.

Confidence among German manufacturers at lowest level since September 2009

Germany is an important foreign market for the Dutch manufacturing industry. According to the IFO institute, the Business Climate index fell to its lowest level since September 2009. Never in the history of a reunified Germany has it fallen so far. The drop in expectations is the single most precipitous in 70 years of industry surveys. The fall in the indicator of the current situation was less pronounced. In January, the average daily output generated by the German manufacturing industry was over 2 percent lower than in the same month last year. This is reported by Destatis.

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