FACTORY OUTPUT UP ANEW IN DECEMBER

MANUFACTURING output picked up in December from the previous month, but growth remained well below year-earlier levels, the Philippine Statistics Authority (PSA) reported on Wednesday.

The Value of Production Index (VaPI) expanded by 2.6 percent, up from November’s 2.0 percent, while the Volume of Production Index (VoPI) grew by 2.0 percent from 1.8 percent.

Both, however, were markedly slower than the year-earlier 10.1 percent for VaPI and 4.5 percent for VoPI.

The VaPI expansion, the PSA said in a statement, was due to a slower annual decrease of 0.8 percent in the manufacture of food products from -3.7 percent in November.

“The manufacture of food products contributed 25.9 percent to the annual uptrend of VaPI for the manufacturing section in December 2023,” the agency noted.

Food manufacturing also had the highest weight among 22 industry divisions in the computation of the VaPI, it added.

Nine out of the 22 industries posted growth during the month while 13 contracted, data provided by the PSA showed.

The manufacture of pharmaceutical products posted the highest growth rate of 38.4 percent, up from November’s 11.1 percent.

The biggest drop, meanwhile, was in the manufacture of wood, bamboo, cane, rattan articles and related products, which saw its contraction worsen to 56.1 percent from 21.6 percent.

For the full year, VaPI expanded by 5.9 percent, much slower than the annual averages of 22.5 percent and 49.2 percent in 2022 and 2021, respectively.

This was again attributed to food manufacturing, which saw growth slow to 1.2 percent from 14.1 percent in 2022.

As for the VoPI, December’s growth was also due to a “slower annual decline in the manufacture of food products at 1.4 percent … compared with its annual drop of 4.9 percent in the previous month,” the PSA said.

Food manufacturing contributed 34.5 percent to the VoPI uptrend.

Other main contributors were the manufacture of basic pharmaceutical products and pharmaceutical preparations (up 38.2 percent from 11.1 percent previously) and a smaller contraction in the manufacture of fabricated metal products, except machinery and equipment (12.0 percent from -23.5 percent)

Nine of the 22 industry divisions recorded gains, while 13 fell.

In 2023, VoPI recorded a 4.4 percent growth rate, also slowing from the 15.1 percent and 52.6 percent annual averages posted in 2022 and 2021, respectively.

Average capacity utilization, meanwhile, fell slightly to 74.3 percent from 74.8 percent in November.

“All industry divisions reported capacity utilization rates of more than 60.0 percent during the month,” the PSA said.

The top three industry divisions in terms of capacity utilization were the manufacture of rubber and plastic products (80.0 percent), manufacture of machinery and equipment except electrical (79.8 percent), and manufacture of beverages (79.6 percent)

More than a quarter, 168 or 27.4 percent, of the 612 establishments that participated in the PSA survey said they operated at full capacity, defined as 90 to 100 percent.

Meanwhile, 39.4 percent (241 firms) said they operated at 70- to 89-percent capacity, and 33.2 percent (203 firms) operated below 70 percent.