Author丨Fly with wings
Editor丨Zhang Xing
On April 30, the latest data from the National Bureau of Statistics showed that in April, the manufacturing purchasing managers' index (PMI) was 50.4%, down 0.4 percentage points from the previous month, and was in the expansion range for two consecutive months, and the manufacturing industry continued to maintain a recovery and development trend.
From the perspective of the 13 sub-indexes, compared with the previous month, the production index, the purchase price index and the factory price index rose, with the index rising between 0.7 and 3.5 percentage points; the raw material inventory index was flat; the new orders index, the new export orders index, the backlog order index, the finished goods inventory index, the purchase volume index, the import index, the employment index, the supplier delivery time index and the production and business activity expectation index declined, with the index falling between 0.1 and 2.3 percentage points.
Interviewed experts said that affected by factors such as the slowdown in the recovery of domestic demand and the weakening of export support margins, the manufacturing PMI fell slightly in April, and the indicators at both ends of supply and demand in the manufacturing industry showed the differentiation characteristics of "production acceleration and slowing demand", and insufficient demand is still the core contradiction of the current economic operation. However, the warmer weather supports the acceleration of production, the resilience of domestic new kinetic energy is strong, and the manufacturing PMI has been in the expansion range for two consecutive months. It is expected that the policy will enter a period of force in the second quarter, with the PMI at around 50.1% in May, and it is expected to run in the expansion range in the second quarter.
Production continues to recover
Entering April, the recovery of the production side continued to accelerate. The production index in April was 52.9%, up 0.7 percentage points from the previous month and the highest since April 2023, as the production expansion of manufacturing enterprises accelerated. From the perspective of industry, the production index of chemical fiber, rubber and plastic products, railway, ship, aerospace equipment, computer communication and electronic equipment and other industries are all in the relatively prosperous range of more than 55.0%, and the production capacity of enterprises is released rapidly.
Wen Tao, an analyst at China Logistics Information Center, pointed out that in April, new orders increased steadily and the digestion of backlogs in the early stage of the production of enterprises had a good drive, and the continuous growth of corporate profits also boosted the willingness of enterprises to produce, supported by these positive factors, the production activities of manufacturing enterprises accelerated their rise, and the backlog order index was 45.6%, down 2 percentage points from the previous month. Although production activities accelerated in April, the growth rate of raw material procurement activities of enterprises slowed down, and the procurement volume index was 50.5%, down 2.2 percentage points from the previous month. An important reason for the slowdown in the growth rate of raw material procurement is that the procurement stock is relatively sufficient in the early stage, and the rising price of raw materials inhibits procurement demand.
In terms of prices, the purchase price index in April was 54%, up 3.5 percentage points from the previous month. The rise in raw material prices and the growth of market demand also supported the sales prices of manufacturing products, with the ex-factory price index at 49.1%, up 1.7 percentage points from the previous month.
Wen Tao said that with the acceleration of economic recovery, the cost pressure of enterprises will rise rapidly in the short term. In April, the purchase price index was nearly 5 percentage points higher than the ex-factory price index, indicating that the price growth rate of raw materials was significantly higher than that of products. According to the enterprise survey, the proportion of manufacturing enterprises reflecting high raw material costs was 46%, an increase of 4.2 percentage points from the previous month.
Wang Qing, chief analyst of Oriental Jincheng, told the 21st Century Business Herald reporter that the rise in the ex-factory price index indicates that the downward momentum of industrial product prices has slowed down recently, but the indicator is still in the contraction range for 7 consecutive months, which means that PPI will continue to be in the negative growth range in the short term. Behind this is the current stable supply and the market demand is still insufficient. The purchase price index of major raw materials rose sharply by 3.5 percentage points to 54.0% in April, mainly due to the impact of OPEC+'s continuous production cuts, the rise in international crude oil prices, and the recent sharp rise in the prices of non-ferrous metals such as copper and aluminum priced overseas under the upward cycle of the global electronics industry. At present, the price index of major raw materials has been significantly higher than the ex-factory price index, which is confirmed by the slowdown in the profit growth rate of industrial enterprises in March, and may also form a certain pressure on the profits of the middle and downstream manufacturing industries in the later period.
Wu Chaoming, vice president of the Finance and Credit Research Institute, predicts that the month-on-month increase in the industrial producer price index PPI in April will be strengthened, and the PPI is expected to be around -2.2% in April. With the moderate recovery of domestic demand, the decline is expected to gradually narrow during the year, but there is a high probability of negative growth throughout the year.
The gap between supply and demand has widened again
The decline in raw material purchases is also related to the current change in aggregate demand. The new orders index in April was 51.1%, although it was still in the expansion range, but it was down 1.9 percentage points from the previous month. External demand also showed a similar situation, with the new export orders index at 50.6% in April, down 0.7 percentage points from the previous month, continuing to maintain expansion.
Zhang Liqun, a special analyst at the China Federation of Logistics and Purchasing, pointed out that the current order index has declined, reflecting that the proportion of enterprises with insufficient demand is still close to 60%, indicating that the problem of insufficient demand is still prominent. Affected by this, the expectation index of production and business activities has declined. Overall, the economy continues to recover, but demand constraints are the main pressure.
Wu Chaoming told the 21st Century Business Herald reporter that the "difference between production and new orders index" in the manufacturing industry changed from -0.8% in March to 1.8% in April, and the gap between supply and demand turned from negative to positive, rising again to a historically high range. On the whole, the problem of insufficient domestic demand is still prominent, and it is expected that the future will still show a pattern of "strong supply and weak demand", but benefiting from the implementation of a package of policies to expand domestic demand and stabilize growth, the future domestic supply and demand convergence will be enhanced, and the positive gap between supply and demand will run in the low range.
"We must focus on enhancing the role of government investment in driving domestic demand and change the state of insufficient demand as soon as possible. Zhang Liqun said.
However, the inventory index of raw materials and finished products in April was 48.1% and 47.3% respectively, flat from the previous month and down 1.6 percentage points from the previous month, respectively, and were in the contraction range.
Wu Chaoming believes that the inventory of raw materials is flat and the inventory of finished products has fallen, showing that enterprises are still in the destocking cycle, and the constraints on the production side of insufficient domestic demand are still strong, and the willingness of enterprises to significantly increase raw material inventories is also insufficient. In addition, the continued recovery of domestic demand has formed a certain consumption of finished product inventories, but due to the weak recovery of market expectations, the willingness of midstream and downstream enterprises to take the initiative to replenish inventories is not strong.
Wu Chaoming predicts that the follow-up policy afterburner and the recovery of domestic demand will form a certain consumption of enterprise inventory, and the destocking cycle of industrial enterprises has come to an end, but the recovery of domestic real estate demand is still facing certain twists and turns and uncertainties, coupled with the uncertainty of external demand, the overall domestic total demand is still weak, and the official opening of the inventory replenishment cycle still needs to wait.
Looking forward to the follow-up trend of PMI, Zhou Maohua, a macro researcher at the financial market department of Everbright Bank, told the 21st Century Business Herald reporter that the economic growth rate in the second quarter is expected to further accelerate due to the strong support of macro policies such as trade-in and equipment renewal, coupled with the relatively low base last year. However, from the perspective of indicators, the recovery momentum of domestic economic activities is moderate, the price level is low, the real estate market is sluggish, some industries and enterprises are facing the problem of insufficient demand, some enterprises are cautious in increasing investment and production, and the outlook for overseas demand is uncertain, etc., the domestic economic recovery still needs strong support from macro policies.
Wang Qing predicts that the manufacturing PMI index will be around 50.2% in May, which is expected to be in the expansion range for three consecutive months. On the one hand, driven by the upward cycle of the global electronics industry, the global manufacturing industry will still maintain an upward momentum in the short term, and external demand will continue to have a positive impact on the prosperity of the domestic manufacturing industry. Domestically, with the full implementation of the large-scale equipment renewal and consumer goods trade-in policy, as well as the promotion of the development of new productive forces, manufacturing investment and infrastructure investment will maintain a rapid growth level, which will have a certain role in stimulating both ends of supply and demand in the manufacturing industry. However, it is still necessary to pay close attention to the impact of the adjustment of the real estate industry on the overall manufacturing boom level.
SFC
Editor: Liu Xueying, intern: Dong Danlin
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