Tenth District manufacturing activity expanded more rapidly in April, with the composite index matching its highest level in survey history, and optimism remained high for future activity. Selling price indexes increased further, while raw material price indexes remained at high levels.

The month-over-month composite index was 26 in April, up from readings of 17 in March and 17 in February (Tables 1 & 2, Chart 1). The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Factory activity accelerated at both durable and nondurable goods plants, particularly for machinery, plastics, and chemicals. Month-over-month indexes increased considerably.

Composite Index vs. a Month Ago

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Date Composite
17-Apr 10
17-May 9
17-Jun 12
17-Jul 12
17-Aug 16
17-Sep 18
17-Oct 22
17-Nov 15
17-Dec 13
18-Jan 16
18-Feb 17
18-Mar 17
18-Apr 26

The production index jumped from 20 to 33, and the shipments, new orders, and order backlog indexes also rose. The employment and new orders for exports indexes were unchanged. The raw materials inventory index increased from 11 to 17, while the finished goods inventory index fell slightly.

Year-over-year factory indexes were mixed but showed little change overall. The composite index was basically unchanged at 36, while the production, shipments, and new orders indexes eased slightly. The employment index inched lower from 37 to 35, while the order backlog and capital expenditures indexes increased moderately. The raw materials inventory index edged higher from 30 to 32, while the finished goods inventory index decreased.

Future factory activity expectations were mixed but were still solid overall. The future composite index slipped from 33 to 31, and the future new orders and order backlog indexes also fell. In contrast, the future production and shipments indexes moved slightly higher, while the future employment and capital expenditures indexes were largely unchanged. The future raw materials inventory index edged down from 21 to 19, and the future finished goods inventory index also decreased slightly.

Most price indexes were little changed in April but remained at high levels. The month-over-month finished goods price index edged higher from 24 to 29, while the raw materials price index eased slightly. The year-over-year finished goods price index increased from 49 to 60, while the year-over-year raw materials price index was unchanged. The future finished goods price index moved up from 48 to 53, while the future raw materials price index moderated somewhat.

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About Manufacturing Survey

Author

Chad Wilkerson

Vice President, Economist and Oklahoma City Branch Executive

Chad Wilkerson is Branch Executive of the Kansas City Fed’s Oklahoma City Branch office. In this role, he serves as the Bank’s lead officer and regional economist in Oklahoma. He…