Plastics Processing Contraction Steadied in November
Though still contracting, November marks a break in what has been a steadily faster rate of contraction in plastics processing activity.
The Gardner Business Index (GBI): Plastics Processing closed November at 46.3, inching back a little closer to September’s index (46.7) before it dropped to 45.9 in October. The index is based on survey responses from subscribers to Plastics Technology. Indices above 50 signal growth; below 50, contraction.
FIG 1 Plastics Processing activity contracted again in November for total plastics processing and even more so for custom processing — but both contracted more slowly than in the previous month.
Two GBI components still contracting in November, but at levels consistent with October, are production and exports. In fact, exports have contracted at the same level since June. Employment has been essentially flat, not expanding or contracting, for three months now.
Meanwhile, backlogs and new orders contracted to similar degrees in November. Backlogs could afford to contract, considering the degree to which they had expanded, due at least in part to supply-chain issues. That new orders are not coming in to refill the pipeline, however, is not encouraging.
FIG 2 Backlogs and new orders both contracting make for a concerning combination in November. (3-MMA = 3-month moving average).
Supplier deliveries continued to lengthen but at a slower rate than in immediately previous months.
Overall business activity for custom processing contracted again in November—more strongly than processing overall—but at a slower rate, closing the month at 43.1 compared with October’s 41.
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