Industry growing fastest in south

Otago's November manufacturing activity continues to lead the country, which overall remains in expansion territory.

Pre-Christmas order books in Otago, especially for food and beverage operators, underpinned the region's continuing lead, with 70.6 points, in the monthly BNZ-BusinessNZ performance of manufacturing index (PMI).

Scores above 50 denote expansion and below 50, contraction.

Otago Southland Employers' Association chief executive John Scandrett said there were reports of strong pre-Christmas order books from food and beverage operators and a wide array of metal, timber, machinery, petfood and brushware products manufacturers.

"The latest survey presents widespread evidence of robust and well-anchored seasonal performance levels across virtually all manufacturing sub-sectors,'' he said.

The only hint of negativity came from two operators with agribusiness connections.

In the September index, Otago-Southland led the four areas with 60.4 points; in October that level pushed out to 80.2 points; in November it pulled back to 70.6 - still ahead of the other three regions across the country.

For November, Central North Island had 55.4 points, northern North Island 64 points and Canterbury-Westland 54.2 points.

Earlier this week, Statistics New Zealand data showed the food and beverage sector growth had underpinned a boost in nationwide manufacturing sales, with volumes up 3.5% and values up 4.2% to $23.6billion for the quarter to September.

Nationally, the seasonally adjusted index for November was 54.7 points, with the sector now in continued expansion since October 2012.

BusinessNZ's executive director for manufacturing Catherine Beard said the November result continued the positive trend for the sector.

It was 1.5 points higher than October and similar to expansion levels experienced in both August and September, she said.

BNZ senior economist Doug Steel said the positive signals from the index were continuing.

"It affirms our thinking that the economy has grown a bit faster in the second half of 2015 than it did in the first half,'' Mr Steel said.

Mr Steel said evidence of strong new orders suggested more to come.

"No-one should have been too surprised by the positive signals in the official data.

"The PMI suggests solid growth has continued into the final quarter of the year,'' he said.

simon.hartley@odt.co.nz

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