Supply challenges impact metalformers’ outlook
Pic caption: David C. Klotz, President, Precision Metalforming Association.
Metalforming companies continue to predict challenging business conditions during the next three months, according to the June 2021 Precision Metalforming Association (PMA) Business Conditions Report. Prepared monthly, the report provides an economic indicator for manufacturing, sampling 118 metalforming companies in the United States and Canada.
PMA is the full-service trade association representing the US$ 137-billion metalforming industry of North America—the industry that creates precision metal products using stamping, fabricating, spinning, slide forming and roll forming technologies, and other value-added processes.
PMA’s June report shows that only 36% of metalforming companies forecast an improvement in economic activity in the next three months (compared to 41% in May), 52% predict no change (compared to 49% in May) and 12% anticipate a decline in activity (increasing from 10% in May).
Sixty-six percent of respondents reported an increase in lead times, slightly down from 71% in May and the first decline reported in eight months.
“Obtaining raw materials and finding workers are the biggest challenges reported by PMA members,” said PMA President, David Klotz. “Members are reporting lead times extending into 2022 for steel, with similar challenges for aluminium, copper, brass and other metals. The semiconductor shortage that has idled some auto plants also is negatively impacting orders. PMA, through its One Voice advocacy team in Washington, D.C., continues to engage policymakers and members of Congress to find ways to increase supply, including ending the damaging and unnecessary Section 232 steel and aluminium tariffs, and to help the industry recruit workers by promoting awareness and training.”
Current average daily shipping levels decreased in June, with only 43% reporting an increase (decreasing from 60% in May), 39% reporting no change (compared to 30% in May) and 18% reporting a decrease (increasing from 10% in May).
The survey also revealed a slight decline in expectations for incoming orders in the next three months, with 38% forecasting an increase in orders (decreasing from 42% in May), 44% predicting no change (the same percentage reported last month) and 18% anticipating a decrease in orders (compared to 14% in May).
Four per cent of responding metalforming companies had a portion of their workforce on short-time or layoff in June, the same percentage reported in May. Full report results are available at https://www.pma.org/public/business_reports/pdf/BCREP.pdf