Overall Activity Levels in Positive Territory
Mold Business Index for December 2005
Business conditions for North American moldmakers ended 2005 on a positive note, as a welcome gain in New Orders pushed overall activity levels into positive territory in December. Based on the latest survey for our Mold Business Index (MBI), the MBI value for December is 52.3. This is a 3.8 percentage point increase from the November value of 48.5. Solid increases also were posted in the Employment and Future Expectations components. For 2005 as a whole, the total MBI registered an increase in 10 of the 12 months. And moldmakers should take heart in the fact that as we enter 2006, the trend in the overall data remains on an upward trajectory.
The latest sub-index for New Orders of molds is 60.3, which means that the amount of new business in December was significantly higher than in the previous month. Production activity was steady in December, as the latest Production sub-index is exactly 50.0. The Employment component is 60.3, which indicates that the total number of workers in the industry increased again during the past month. The industry’s overall backlog was mostly steady, as the Backlog sub-index is 46.6.
The Future Expectations sub-index at 75.9 for December indicates that moldmakers are increasingly optimistic about business conditions in the coming year. However, there was very little change in their reported capital investment plans for the future. The prices paid for resins and steel remain high, but they are not rising as rapidly as they have in previous months. The latest sub-index for Materials Prices is 67.2. Supplier Delivery Times are beginning to stabilize, with this sub-index posting a value of 46.6 in December.
Our forecast continues to call for rising activity in the plastics manufacturing and tooling industries through the end of 2006. Plastics processors remain in a cyclical upturn in spending on new capital equipment and tooling. The major plastics indicators show that manufacturing levels and utilization rates in the U.S. increased in recent weeks, and the U.S. economy’s crucial leading indicators are still in a sustainable growth phase. The biggest threat to this forecast for 2006 is the high price of petroleum and other energy products. But barring a major supply disruption, we will stick with our forecast for energy and materials costs to continue gradually downward in the coming months.
| December 2005 |
|||||
| % Positive |
% |
% Negative |
Net % Difference | Sub-Index | |
| New Orders | 48 | 24 | 28 | 20 | 60.3 |
| Production | 24 | 52 | 24 | 0 | 50.0 |
| Employment | 24 | 73 | 3 | 21 | 60.3 |
| Backlog | 28 | 37 | 35 | -7 | 46.6 |
| Export Orders | 3 | 94 | 3 | 0 | 50.0 |
| Supplier Deliveries | 3 | 87 | 10 | -7 | 46.6 |
| Materials Prices | 35 | 65 | 0 | 35 | 67.2 |
| Mold Prices | 10 | 76 | 14 | -4 | 48.3 |
| Future Expectations | 59 | 34 | 7 | 52 | 75.9 |
| Total Mold Business Index for December 2005: 52.3. The total Mold Business Index is a weighted average of the sub-indices for new orders, production, employees, backlog, exports and supplier deliveries. | |||||
Related Content
-
Editorial Guidelines: Editorial Advisory Board
The Editorial Advisory Board of MoldMaking Technology is made up of authorities with expertise within their respective business, industry, technology and profession. Their role is to advise on timely issues, trends, advances in the field, offer editorial thought and direction, review and comment on specific articles and generally act as a sounding board and a conscience for the publication.
-
Think Safety: Eliminate Hazards Throughout the Shop
The tooling community is taking advantage of new products for safer mold shops and molding facilities.
-
Dynamic Tool Corporation – Creating the Team to Move Moldmaking Into the Future
For 40+ years, Dynamic Tool Corp. has offered precision tooling, emphasizing education, mentoring and innovation. The company is committed to excellence, integrity, safety and customer service, as well as inspiring growth and quality in manufacturing.
