Asia Manufacturing Cost Drivers Report – 10/15
Most raw material prices and cost drivers associated with Asia manufacturing continued in October extending this year’s strongly favorable trend.
Specifically:
Almost all General Purpose Plastic resin prices moved favorable again in October except PET which also moved up again in price by 3.7%. Year-over-year, most prices are still significantly lower on average by over 23%, led by General Purpose PP which is down by over 34%. One notable exception is PET which is up in price by over 9% year-over-year.
Most Engineering Grade Plastic prices continued to drop in price in October by about 3% except ABS & POM were unchanged from September. Year-over-year price for all engineering resins are down in price on average by over 11%, except ABS which is up slightly (less than 1%).
Rubber prices also showed favorable movement in October down in price on average by 6%. And all prices remain well below last year’s levels by 14%-27%.
Carbon Steel prices continued the strongly favorable trend in October, with prices down another 3% on average. Year-over-year prices Carbon Steel is significantly lower in price by 30%-40%.
Stainless Steel prices also moved lower again in October except 304 grade which remained unchanged. Year-over-year Stainless Steel prices were lower by 14% on average compared with one year ago, except 410 grade which bucks the trend, up by over 12%.
Aluminum prices dropped by over 8% in October and year-over-year prices remain lower by over 20% on average.
In other metals, October saw Zinc, Copper & Nickel reverse the recent downward trend by shooting up close to 2% on average, while Brass dropped slightly. Year-over-year, Brass, Copper & Nickel all remain well below last year’s levels by 20% on average, while Zinc is up fractionally versus one year ago.
Wood prices were unchanged in October, however, year-over-year, prices are down on average by over 2.2% .
All Paper prices remained flat trends in October while year-over-year, prices are mixed with Kraft & Gray Cardboard higher by about 3%-6%, while Corrugated, White Cardboard & Art Paper are all lower by 1%-2%.
In Textile Fabrics only Cotton saw a change in price, down by a fraction in October bringing its year-over-year price change to 10% lower. Most other textile fabrics were unchanged in October and remain down in price by over 5% on average versus one year ago.
In Ceramics Raw Materials prices, only Alumina saw a change, down in price by over 3%. Year over year, prices are mixed with Feldspar, Kaolin & Alumina down in price on average by over 7%, while Quartz is up by over 7%.
Asian labor rates were stable in October, while, year-over-year, Thai and Bangladesh rates are unchanged while China Labor rates are up over 10% versus one year ago.
China Petroleum Price & China Diesel Oil prices were favorable in October down in price by 5% on average, while Natural Gas was flat and LPG Gas was up by a almost 3%. Year-over-year, all fuel prices are significantly lower in price by 33% on average.
Ocean Freight rates remained unchanged in October but year-over-year freight rates are up by over 7% to the west coast and 10% to the east coast.
Most Asian Currencies were slightly stronger against the US Dollar in October except the Bangladesh Taka & Vietnam Dong. But year-over-year, all Asian Currencies were weaker against the US Dollar by over 5% on average.
As for PMI, the China Purchasing Managers Index stayed at 49.8 again in October while the HK China Purchasing Managers Index moved up slightly from 47.2 to 48.3 (signaling a contracting economy), meanwhile the USA Purchasing Managers Index likewise moved lower slightly from 50.2 to 50.1 but stayed above the all-important 50 benchmark.
China Imports & Exports rose by 6.3% & 4.4% respectively in September while year-over-year, Imports and Exports declined by 20.5% & 3.8% respectively. (data lags by one month).
The China Producer Price Index (PPI) was unchanged in September while the China Consumer Price Index (CPI) was down by a fraction. (data lags by one month). For the year, the PPI is down by 4.2% while the CPI is unchanged.
For additional details, please refer to the charts that follow or contact one our Operations Specialists for more information.
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