JUL 2018


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JULY 2018 12 CompositesWorld GARDNER BUSINESS INDEX: COMPOSITES FABRICATING May 2018 – 57.4 » e GBI: Composites Fabricating Index for May registered 57.4, moving lower after having set an all-time record in April. Compared to the same month one-year ago, the Index showed an increase of 4.1%. Five of the six measures used to calculate the Index fell during the month. Only the Supplier Deliveries subindex remained unchanged, near its all-time high set earlier this year. May's lower readings could suggest that the industry's growth is merely moderating after achieving unprecedented levels of growth earlier in the calendar year. While May's numbers were comparably lower than recent periods, all components continued to register expansionary gains (>50.0 readings) for the month. e Gardner Intelligence team's review of the underlying data for the month indicates that the Index was pulled strongly higher by Supplier Deliveries. e Index was also supported by Produc- tion, Employment and New Orders. But the Composites Fabricating Index — an averages-based calculation — was pulled lower by Backlogs and Exports, both of which indicated slowing growth during the month. e relatively stronger Production reading as compared to New Orders may explain why Backlogs growth slowed sharply in the May data. In four of the first five months of 2018, Produc- tion growth exceeded New Orders. Consistent with the Gardner Intelligence team's under- standing of the manufacturing business cycle, fabricators are continuing to adjust and increase production output through improvements to their supply chains and employment levels. e elevated growth in New Orders since 2017 has forced shops to make long-run changes to their operations to accommodate stronger demand for products. Composites Index moves lower after setting all-time high Michael Guckes is the chief economist for Gardner Intelligence, a division of Gardner Business Media (Cincinnati, OH US). He has performed economic analysis, modeling and forecasting work for nearly 20 years in a wide range of industries. Guckes received his BA in political science and economics from Kenyon College and his MBA from Ohio State University. ABOUT THE AUTHOR Backlogs peaking as Production, New Orders growth slows Although fabricators have sought to match supply to increasing demand in the latest market upcycle, Backlogs have grown at unprecedented levels. May data indicate slowing growth in New Orders might curtail future Backlogs growth. Stay ahead of the curve with Gardner Intelligence. Visit the blog at or e-mail PRESENTED BY GBI: Composites Fabricating GBI: Composites Fabricating — Production, New Orders and Backlogs (3-month moving average) New Orders Backlogs Production Still growing, but at a slower pace The Composites Fabricating Index moved lower in May after recording a record high in April. All components except for Supplier Deliveries (unchanged) indicated slowing growth.

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