Otago and Southland's manufacturing sector is teetering on
the knife edge of contraction and expansion, dragged down by
lacklustre results from production and deliveries.
While the Otago Southland region has steadily declined from
60 in May, to around 55 in June and July and finished at the
end of September at 50.7, other regional and the national
figures have also languished. Scores above 50 in the
manufacturing index denote expansion, and below, contraction.
The chief executive of the Otago Southland Employers'
Association, John Scandrett, noted that for September, the
Canterbury/Westland index, where a strong performance would
have been expected, delivered a national low-end 42.5 point
Nationally, the index declined for the second consecutive
month to 54.3, but compared with previous September results
the 2013 value was the highest since 2007.
Business New Zealand's executive director for manufacturing,
Catherine Beard, said while the September expansion dip was
not ideal, the sector remained in a ''solid position''.
''Manufacturing activity has now been in expansion for 10
consecutive months, with 2013 remaining on track to be one of
the best years for the sector in some time,'' she said.
Residential building activity throughout the country was one
of the drivers, she said.
Mr Scandrett said the September sub-indices of new orders and
finished stock indicators were tracking positively, but
disappointingly, while the production and deliveries
yardsticks did not hit the 50-point barrier.
''Those sub-indices have held back the September outcome, and
may possibly impact negatively on next month's performance,
especially the production indice,'' he said.
He noted ''mixed reactions'' from wood and paper products
operators, who saw volatile market conditions, negative
feedback on food and beverage results, but also reports of
''robust seasonal factors'' lifting textile and machinery