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National manufacturing data remains in positive territory, just, but Otago Southland is the only one of four regions in contraction for the month of May.
The weak Australian economy, its dollar weakness and dairy prices affected the results.
Nationally, manufacturing was down 0.2 points on the previous month, to 51.5 for May, in data collated in the BNZ-Business New Zealand performance of manufacturing index.
A reading above 50 indicates expansion, and below, contraction.
Nationally, the index has been in expansion mode for 32 consecutive months, but on several occasions just in the 51-52 range.
Otago Southland repeated its disappointing April results, albeit gaining from 41.9 in April to 47.5 in May.
Otago Southland Employers' Association chief executive John Scandrett said although upper-end finished stock levels were positive in the readings, readings for new orders and deliveries were clearly negative.
Food and beverage, wood and paper, metal and machinery and textile and clothing responses were ''largely on the south side'' of what would be ideal, Mr Scandrett said, but there were ''threads of positive opinion'' concerning dairy, marine, pet food and brushware manufacturing.
BusinessNZ's executive director for manufacturing, Catherine Beard, said the national May result showed a growing picture of a general slowdown in manufacturing expansion.
She said comments in May were along similar lines to April's in terms of the high value of the New Zealand dollar, against the Australian, as well as the lacklustre Australian economy.
''In addition, a number of respondents mentioned the lower dairy payout causing a decrease in new orders,'' Ms Beard said.
BNZ senior economist Craig Ebert said the New Zealand dollar was down 20% against its US counterpart, at the corresponding time a year ago, which might provide some support for manufacturers in coming months.