Volume of Production and Net Sales

Volumes of production and net sales for total manufacturing increased in October 1999 by 8.7 percent and 13.5 percent, respectively compared to a year ago according to the preliminary results of the Monthly Integrated Survey of Selected Industries (MISSI).

After registering negative growth rates in the volume of production last month, transport equipment, electrical machinery, miscellaneous manufactures and tobacco posted positive growth rates in October 1999. This can be attributed to the resumption of operations in some key establishments and increase in demand of some products.

This is the third consecutive month of positive growth in the volume index replicating the performance from March to May this year.

October growths were positive for both production and net sales in food, wood, petroleum, basic metals, electrical machinery and miscellaneous manufactures. However, of these, only petroleum and miscellaneous manufactures were operating at near full capacity.

Capacity Utilization

Of the 403 responding establishments, 50.5 percent operated below 70 percent capacity. Nine out of 16 sectors showed declines in their capacity utilization in October 1999.

Value of Production

In October 1999, value of production index (VaPI) of 535.6 increased by 15.6 percent from 463.2 in October 1998. Year-on-year increases were observed in 11 out of 16 major sectors (See Annex 1-A). Transport equipment posted the highest year-on-year VaPI growth of 68.3 percent due to the increase in production which was brought about by increase in demand in cars and motorcycles. Other sectors that posted double-digit increases were petroleum refineries (31.8%), tobacco (24.7%), wood & wood products (12.4%), beverages (12.4%) and electrical machinery (11.7%).

On the other hand, wearing apparel posted the highest year-on-year decrease of 28.0 percent in the value of production. Other sectors which exhibited year-on-year decreases were furniture & fixtures (-27.0%), chemicals (-15.3%), textile (-6.3%), and non-metallic mineral products (-1.4%). Decreases in these sectors can be attributed to the slowdown in production due to low demand, higher cost of raw materials and partial shutdowns of machinery.

Volume of Production

The volume of production index (VoPI) increased by 8.7 percent to 147.8 from 135.9 of the same month last year. Eight out of 16 sectors posted year-on-year increases led by transport equipment which increased by 63.4 percent (See Annex 1-B). Other sectors which exhibited double-digit increases were tobacco (27.5%), miscellaneous manufactures (16.9%), wood & wood products (14.3%), basic metals (14.3%) and electrical machinery (12.3%).

Value of Net Sales

The value of net sales for October 1999 increased by 22.9 percent compared to last year. Eleven out of 16 sectors posted increases led by wood & wood products which posted a year-on-year growth of 97.6 percent (See Annex 2-A). Other sectors that recorded double-digit increases were miscellaneous manufactures (84.0%), electrical machinery (58.3%), petroleum products (54.7%), chemicals (32.4%), rubber products (13.0%) and beverages (10.9%).

Volume of Net Sales

The volume of net sales for October 1999 posted an increase of 13.5 percent over the same month last year. Increases were observed in 7 out of 16 sectors led by miscellaneous manufactures which increased by 107.0 percent (See Annex 2-B). Other sectors that exhibited positive year-on-year growths were wood & wood products (100.9%), electrical machinery (60.6%), chemicals (23.9%), petroleum products (18.4%), food manufacturing (10.6%) and basic metals (8.4%).

On the other hand, decreases were observed in 9 out of 16 sectors led by transport equipment which decreased by 65.8 percent. Other sectors that exhibited double-digit decreases were wearing apparel ( -21.0%), furniture & fixtures (-16.3%), textile (-16.3%) and paper & paper products (-11.4%).

Capacity Utilization

Responding establishments operating below 70% capacity were 50.5 percent in October 1999 compared to 41.7 percent a year ago. About 14.3 percent operated at full capacity (90%-100%) compared to 17.3 percent in October 1998.

The following sectors that had decreased use of existing capacity in October 1999 were food manufacturing, beverage, tobacco, textile, wearing apparel, wood & wood products, chemicals, basic metals and electrical machinery. On the other hand, furniture & fixtures, paper & paper products, rubber products, non-metallic mineral products, and transportation equipment showed indications of increasing capacity utilization. Capacity utilization is defined as the ratio of output to the maximum rated capacity of the plant.

Response Rate

These results were based on the response of 403 sample establishments, which comprised 72.9 percent of the total number of establishments covered by the survey.

r - revised due to updating of data from late responding establishments.

Source: National Statistics Office
Manila, Philippines