Asia Manufacturing Cost Drivers Report – 11/15

November saw prices moving down in price for the most part.  Specifically:

General Purpose Plastic resin prices were down in price another 2%-8% except PET which was unchanged. Year-over-year, most prices are still significantly lower on average by over 25%, led by General Purpose PP which is down by over 34%. PET is the notable exception and is actually up in price by over 9% year-over-year.

Engineering Grade Plastic prices also dropped another 2%-4% except ABS & POM which were stable. Year-over-year price for all engineering resins are down in price on average by over 13%, except ABS which is up slightly (less than 1%).

Rubber prices also showed favorable movement in November down in price on average by over 6%. And all prices remain well below last year’s levels by over 24% on average.

Carbon Steel prices continued the strongly favorable trend in November, with prices down another 4% on average. Year-over-year all Carbon Steel prices are significantly lower in price by 32%-46%.

Stainless Steel prices were more stable dropping only slightly about 1% on average in November. Year-over-year Stainless Steel prices remain lower by 14% on average compared with one year ago, except 410 grade which bucks the trend, up in price by over 11%.

Most Aluminum prices continued the favorable trends down by 1%-4% except 6061 grade which reversed the recent downward trend by shooting up over 30% in November.  Year-over-year prices remain lower by over 25% on average except Aluminum 6061 which is now priced 16% above one year ago.

In other metals, November saw prices return the downward trends in November after the stick in October with Zinc & Brass down 7%, Nickel down 10% & copper down 9%. Year-over-year, all remain well below last year’s levels by over 22% on average.

Wood prices were remain unchanged in November, however, year-over-year, most prices are down on average by over 2% except MDF which is unchanged compared with one year ago.

Likewise, all Paper prices remained flat in November. However, year-over-year, prices are mixed with Kraft , White Cardboard & Gray Cardboard higher by about 4% on average, while Corrugated is lower by about 2% and Art Paper about even with last year.

Textile Fabrics prices were also flat, only Cotton was down by a fraction in November bringing its year-over-year price change by over 8% lower. Most other textile fabrics were unchanged in November and remain down in price by almost 5% on average versus one year ago.

In Ceramics Raw Materials prices, only Quartz saw a change, down in price by 2.7%. Year over year, prices are mixed with Feldspar, Kaolin & Alumina down in price on average by over 7%, while Quartz is up by over 10%.

Asian labor rates were stable in November, while, year-over-year, Thai and Bangladesh rates are unchanged while China Labor rates are up over 10% versus one year ago.

In Fuel & Power, all prices were up by 3%-17%, especially Natural Gas & LPG Gas, price which is up by 16.87% & 17.47% respectively. However, all fuel prices are significantly lower in price by over 20% on average versus one year ago.

Ocean Freight rates remained unchanged in November and year-over-year.

Most Asian Currencies were slightly weaker against the US Dollar in November, with the exception of Vietnam Dong which is slightly stronger and year-over-year trends, all Asian Currencies were weaker against the US Dollar by over 5% on average.

All of the PMI indexes signaled a contracting economy in November. The China Purchasing Managers Index moved from 9.8 to 49.6 and the HK China Purchasing Managers Index moved up slightly from 48.3 to 48.6, while the USA Purchasing Managers Index slipped below 50 moving from 50.1 to 48.6.

China Imports declined 10% in October and is 19% lower year-over-year. China Exports also declined In October by over 6% and are 7% lower year-over-year. (data lags by one month).

The China Producer Price Index (PPI) was unchanged in October while the China Consumer Price Index (CPI) was down by a fraction. For the year, the PPI is down by 3.8% while the CPI is down slightly by 0.3%. (data lags by one month).

For additional details, please refer to the charts that follow or contactone our Operations Specialists for more information.

 

Source Int’l Mfg Cost Drivers Report-November, 2015

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