CompositesWorld
Issue link: https://cw.epubxp.com/i/546021
AUGUST 2015 16 CompositesWorld BUSINESS INDEX 70 60 50 40 30 » With a reading of 50.4, the CompositesWorld Business Index for the US composites industry in June indicated expansion for the frst time since March 2015. Te rate of growth was slower than the growth recorded from November 2014 to March 2015, but at least the industry was growing again. Te Index had been at its lowest level in May since August 2013. And compared with one year earlier, the Index for June, despite the uptick, continued to contract. On an annual basis, the US industry contracted in June at an accelerating rate for a second month. A dramatic improvement in new orders was the key reason for the shift to growth from contraction in the overall Index. New orders had contracted at a moderate rate the previous two months. But in June new orders grew faster than its average in the previous year. Production moderately expanded in June. Te rate of increase was unchanged from May. As a result, the backlog subindex contracted at a signifcantly slower rate in June. In fact, a slight uptrend in the backlog index has been tracked since February 2015. Tis was a sign that capacity utilization at US composites fabrication facilities should improve soon. Employ- ment in June was essentially unchanged for the third month in a row. Exports contracted for the 12 th straight month. Te rate of contraction had generally accelerated since December 2014, which correlates with very strong growth in the value of the US dollar. Supplier deliveries lengthened at one of their slowest rates of 2015. Since March, material prices had increased at a generally accel- erating rate. However, the rate of increase in material prices in June was still less than at any time since November 2012. Prices received were unchanged in June after decreasing in May. Prices received had increased from December 2014 through April 2015. Future business expectations improved somewhat in June from May — they were about 5% above their historic average but also near their low to that point in 2015. In May, all but the largest US composites fabricator catego- ries contracted. In June, however, all but the smallest facilities group showed increases. Plants with more than 250 employees expanded for the second month in a row. Companies with 100-249 employees expanded for the third time in four months. Plants with 50-99 employees expanded for the second time in four months as did fabricators with 20-49 employees. All of these plants grew at a similar rate in June. Fabricators with 1-19 employees contracted for the fourth month in a row. Te rate of contraction had been fairly consistent in all four months. Regionally, the US Southeast was, by far, the fastest growing in June. In fact, its subindex was the second highest ever recorded for any region since the CWBI survey began in December 2011. Te region expanded for the third time in four months. Te North Central-East expanded for the sixth time in seven months, and the West also grew, but did so at a very modest rate. Te South Central was fat in June after contracting sharply in May. Te Northeast contracted in June for the sixth time in seven months. Te North Central-West contracted at a very signifcant rate and for the second time in three months. In June, future capital spending plans expected in the coming 12 months were less than 50% of their historic average. Compared with one year earlier, future spending plans had fallen of by 66%. June was the fourth month in a row those plans had contracted by at least 27%. CW Business Index at 50.4 – First growth in two months Steve Kline, Jr. is the director of market intelligence for Gardner Business Media Inc. (Cincinnati, OH, US), the publisher of CompositesWorld magazine. He began his career as a writing editor for another of the company's magazines before moving into his current role. Kline holds a BS in civil engineering from Vanderbilt University and an MBA from the University of Cincinnati. skline2@gardnerweb.com A CWBI reading of >50.0 indicates expansion; values <50.0 indicate contraction. 60 50 40 54.0 51.7 48.2 50.6 New Orders Production Backlogs Employment Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 50.4 CWBI JUNE Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15