The long-term average over the past two decades is 0.5. Producer confidence reached an all-time high (10.9) in February 2018 and reached an all-time low (-28.7) in April 2020. Pessimism has prevailed among Dutch manufacturers since April 2020.
|year||month||balance (average of the component questions)|
Opinions on future output slightly positive
In July, opinions on future output have again improved substantially, and are positive for the first time since March 2020. The unprecedented downturn in April has been completely reversed within a period of three months. Manufacturers are also less negative about their order position. However, their opinion on stocks of finished products remain virtually unchanged and equally negative.
Future output is the only component indicator of producer confidence that is positive. Manufacturers who anticipate output to increase over the next three months outnumber those expecting output to decline. The other two component indicators are negative. More manufacturers consider their order position to be weak rather than strong, given the time of year. There are more manufacturers who define their current stocks of finished products as too large rather than too small.
|year||month||balance (balance % positive and % negative answers)|
Confidence increases among producers in all sectors
In all sectors of the industry, producer confidence is less negative than it was in June. In the timber and building materials industry the confidence indicator has turned positive again. Furthermore, a sharp increase in confidence is seen mainly in the textiles, clothes and leather industry. The most negative opinions are found among entrepreneurs in the metal industry. Confidence of producers in the electrotechnical products and machinery industry has hardly improved.
|July 2020 (average of the component questions)||June 2020 (average of the component questions)|
|Timber and building materials||5.5||-1.3|
|Paper and printing||-1.8||-14.2|
|Food, beverages, tobacco||-4.3||-12.7|
|Textiles, clothes, leather||-6.2||-27.3|
|Electrotechnical products and machinery||-8.2||-8.3|
Capacity utilisation rate slightly higher
The industrial capacity utilisation rate stood at 76.9 percent at the start of Q3 2020. This was slightly higher than the 74.2-percent rate at the start of Q2, but it was still the second lowest capacity utilisation rate in over 7 years.
|Capacity utilisation rate (%)|
Manufacturing output 12.5 percent down in May
In May 2020, the average daily output generated by the Dutch manufacturing industry was 12.5 percent down on May 2019. Output showed the largest year-on-year decline in over 11 years.
Confidence among German manufacturers also improving for third consecutive month
Germany is an important foreign market for the Dutch manufacturing industry. According to the Business Climate Index of the IFO Institute, in July producer confidence has improved for the third month in a row. Both opinions on future output and opinions on the current situation are less negative compared to the previous month. The capacity utilisation rate improved in Germany as well, from 70.4 percent to 74.9 percent. In May, the average daily output generated by the German industry contracted by almost 24 percent year-on-year, as reported by Destatis.