The Manufacturing Purchasing Managers’ Index (PMI) dropped to 43.7 per cent in April 2016, compared to 45.9 per cent in the preceding month.
This implies that the manufacturing sector declined at a faster rate during the review period.
The PMI report for April 2016 posted on the Central Bank of Nigeria’s (CBN) website, of the 16 manufacturing sub-sectors, 12 recorded decline in the review month in the following order: furniture and related products; paper products; primary metal; electrical equipment;
computer and electronic products; printing and related support activities; fabricated metal products; plastics & rubber products; textile, apparel, leather and footwear; petroleum and coal products; chemical and pharmaceutical products and food, beverage & tobacco products.
The remaining four sub-sectors however recorded expansion in the following order: appliances and components; cement; nonmetallic mineral products and transportation equipment.
The manufacturing and non-manufacturing PMI report on businesses is based on data compiled from purchasing and supply executives.
The survey responses indicate that there is change or no change in the level of business activities in the current month compared with the previous month. For each of the indicators measured, the report showed the diffusion index of the responses.
The diffusion index is computed as the percent of positive responses plus one-half of the percent of those reporting no change. The composite PMI is then computed as the weighted average of five diffusion indices; production level, new orders, supplier delivery time, employment level and raw materials inventory, with assigned weights of 25 per cent, 30 per cent, 15 per cent, 10 per cent and 20 per cent respectively.
“At 42.7 per cent, the production level index for manufacturing sector declined for the fourth consecutive month, but at a faster rate than that recorded in March 2016. Of the 16 manufacturing sub-sectors, 10 recorded decline in production level during the review month in the following order: primary metal; furniture & related products; electrical equipment; paper products; plastics & rubber products; printing & related support activities; fabricated metal products; textile, apparel, leather & footwear; petroleum & coal products and chemical & pharmaceutical products.
“The computer and electronic products and food, beverage & tobacco products sub-sectors recorded no change. The remaining four recorded growth in production level during the review month in the following order: transportation equipment; appliances & components; nonmetallic mineral products and cement
“The new orders index dropped to 41.8 per cent in April 2016, indicating a decline. The index has been on the decline for four consecutive months. The eleven sub-sectors that recorded declines in new orders were: paper products; primary metal; furniture & related products; computer & electronic products; textile, apparel, leather and footwear; plastics and rubber products; printing and related support activities; fabricated metal products; cement; chemical and pharmaceutical products and food, beverage and tobacco products,” the report added.