Slowing industry expansion led by decline of new orders
A slowing July expansion is reflected by new orders, production and backlog readings, the latter of which experienced a 15-point decline, one of the largest single-month declines in recorded history.
.jpg;width=70;height=70;mode=crop;format=webp)
The Composites Index registered slowing expansion in July after reporting blistering expansion during the second quarter of the year. July’s lower readings signal only slowing growth in the industry.
The Composites Index started the second-half of 2021 with a July reading of 58.3. The industry’s slowing expansion was headed by a 14- and six-point decline in new orders and production activity readings respectively. Backlog activity fell sharply during July as well; historically this reading shadows changes in new orders and is highly influenced by the relative movement of new orders and production. Supplier delivery data also continue to indicate that supply chains remain heavily disrupted. Conversely, July employment and export orders activity both posted encouraging numbers. Employment readings throughout the calendar year have trended higher, signaling an accelerating expansion of composites industry hiring.
In a rarely observed move, total new orders activity fell by 15 points during July. In contrast, export activity in recent months has been above average. This graph is on a three-month moving average.
Ultimately, the declining, asymmetrical readings in (total) new orders and production activity affected backlog activity which posted a 15-point decline, one of the largest single-month declines in recorded history. The latest reading, which finished slightly above 52, indicates that backlog activity only marginally expanded month-to-month. By comparison, a reading of 50 would have indicated no change in backlog levels between June and July.
Related Content
-
Composites industry heads into slightly accelerated contraction in November
The GBI: Composites Fabricating in November continued its general slow-going path of contraction that began in April 2023.
-
Composites industry gained back some ground in December
The GBI: Composites Fabricating contracted a little more slowly in December, landing between August and September 2023 values.
-
Composites industry GBI contracted faster in July
The GBI: Composites maintains its consistent downward trend for the fifth month in a row.
