Index Reaches All-Time High … Again
Index hits record mark for second straight month, with quickening expansion in new orders, backlogs and production.
The Gardner Business Index (GBI) for plastics processing climbed by more than four points during March to close at an all-time high of 65.1. The month’s gains were broad-based, with all six components of the Index reporting expanding activity. The Index is based on monthly surveys of subscribers to Plastics Technology magazine.
Export activity notched a second month of expanding activity, a first since early 2018. Supplier delivery, new orders, production, and backlog activity all reported quickening expansion during March; only employment activity registered slowing growth. The Index reading among only custom processors fell slightly from the prior month due to a decline in export and employment activity readings.
The spread between the new orders and production reading widened to four points in March, representing one of the widest gaps between these measures since early 2019. This lagging-production challenge has been largely attributed to supply-chain disruptions domestically and globally. The current supplier delivery reading at nearly 84 is roughly 20 points higher than the pre-COVID peak reading of nearly 64. The 20-point spread between these peaks means that over 140% more survey respondents in the latest survey may have reported worsening supply-chain conditions compared with the prior peak.
FIG 2 March marks the 1-yr anniversary of the coronavirus’ initial impact on the Plastics Processing Index. COVID-19’s prolonged effect on supply chains has hampered production at a time of quickly expanding demand, resulting in rising material prices and backlogs.
EDITOR’S NOTE: Finding reliable and relevant data to help guide your business is always important, but especially so during challenging economic times. For this reason, the GBI Plastics Processing and Custom Processing Indices serve as a great tool for making data-driven decisions. Thank you to everyone who has previously completed GBI surveys. Your participation helped increased response counts by 15% in 2020, making the GBI better than ever because of your involvement. Thank you for your time and efforts and for trusting us to provide you with the latest industry and business insights both in the past and in the future.
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ABOUT THE AUTHOR: Michael Guckes is chief economist and director of analytics for Gardner Intelligence, a division of Gardner Business Media, Cincinnati. He has performed economic analysis, modeling, and forecasting work for more than 20 years among a wide range of industries. He received his BA in political science and economics from Kenyon College and his MBA from Ohio State University. Contact: (513) 527-8800; firstname.lastname@example.org.
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