Manufacturing Decline in South Africa a Concern

Production Manufacturers Index (PMI): Results for November 2024

The South African manufacturing sector has seen further contraction according to the latest PMI data released today. Overall manufacturing production decreased by -2,6% in November 2024 compared with November 2023. 

Novembers data indicates the lowest production manufacturing figure in five months, with the prospect of production volume heading for an overall contraction for 2024 compared to 2023.

This follows the announcement this week that Steel manufacturer, AcelorMittal, will be shutting its long-steel manufacturing plants at the end of January 2025 after struggling to keep them profitable due to escalating energy and transport costs.

The sectors having the most impact on the manufacturing data are:

• Motor vehicles, parts and accessories and other transport equipment saw a decrease of -11,5% driven predominantly by lower numbers of vehicles for export.
• Basic iron and steel and non-ferrous metal products, metal products and machinery with a decrease of -2,8%
• Wood and wood products, paper, publishing and printing seeing a decrease of -4,4%
• Textiles, clothing, leather and footwear lower by -7,5%

Comparison to Global Figures

In comparison to global manufacturing numbers, Global automotive production has grew by 2,2% in the automotive sector in Q# of 2024 and by 0,8% in developing economies. Iron and steel production grew by 0,9% globally with 0,5% growth recorded in developing economies in Q3 of 2024.

Positive Contributors to PMI

Positive contributors to the overall PMI number were few and thin with petroleum, and petroleum by-products such as; rubber, plastics and chemicals, showing a small growth of 1,3%. This was mostly driven by lower crude oil prices and contributed 0,3 of a percentage point to the overall PMI figure.

Seasonally adjusted manufacturing production decreased by -1,1% in November 2024 compared with October 2024, following month-on-month changes of 0,8% in October 2024 and -0,3% in September 2024.

The three-month seasonally adjusted manufacturing production figure saw a decrease of -0,2% in the three months ended November 2024 compared with the previous three months.

The seriously bad news for production output in South Africa was that four out of the ten manufacturing divisions, all reported negative growth rates over this period. 

Sales results for November 2024

Seasonally adjusted manufacturing sales saw a decrease of -2,9% reported for November 2024 compared with October 2024. This follows month-on-month changes of 2,6% in October 2024 and -1,3% in September 2024.

Seasonally adjusted manufacturing sales decreased by 1,7% in the three months ended November 2024 compared with the previous three months.