Contraction Extended Through September

At 47.5, the Gardner Business Index for Plastics Processing contracted further in September compared with the prior month. (Readings above 50 indicate expanding activity while values below 50 indicate contracting activity. The further away a reading is from 50, the greater the change in activity as compared with the prior month.) Over the last three months, the Index has reported a generally consistent level of contracting business activity for processors.

An analysis of the underlying components of the September Index reveals that while supplier deliveries expanded, this was more than offset by accelerating contraction in backlogs and exports. The remaining components had only a marginal impact on the Index’s monthly result.

The accelerating contraction in export orders over the last 12 months has decelerated both backlogs and total new orders. September experienced an accelerating contraction in exports while total new orders activity was nearly unchanged, implying that domestic orders approximately offset the decline in exports. Production activity has fallen sharply in response to contracting new orders. In the three months ending with September, the production reading averaged 49.1, down from a reading of over 60 during January 2019.

The index is based on surveys conducted monthly of subscribers of Plastics Technology Magazine.