Released March 11, 2022 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--The Institute for Supply Management (ISM) said economic activity in the U.S. manufacturing sector grew in February. However, the survey was conducted before Russia's invasion of Ukraine, which could have an impact on manufacturing across the globe.
The ISM's February Purchasing Managers Index (PMI) registered 58.6%, an increase of 1.0 percentage point from the January reading, indicating expansion in the overall economy for the 21st month in a row, Timothy Fiore, chair of the ISM's Manufacturing Business Survey Committee, said in a press release.
"The impact of omicron declined in February as swiftly as it appeared in December, leaving March and April's manufacturing environment favorable, especially with new orders and backlogs registering strong growth," Fiore said. The indexes for new orders and the order backlog increased 3.8 and 8.6 percentage points, respectively, compared with January.
Companies surveyed for the report expressed positivity amid ongoing issues. Fiore said: "The U.S. manufacturing sector remains in a demand-driven, supply chain-constrained environment (...) A higher-than-normal quits rate and early retirements continued," but added, "Panel sentiment remained strongly optimistic, with 12 positive growth comments for every cautious comment, up from January's ratio of 7-to-1."
However, the survey was conducted before Russia's invasion of Ukraine, which could hurt U.S. manufacturing activity that is still being impacted by supply-chain issues. The PMI covers 18 industry sectors, ranging from computer and electronic products to food, beverage and tobacco products.
The conflict is wreaking havoc on an already-battered global supply chain, in which maritime shipping accounts for 80% of the world's trade. Ukraine has closed its ports, and the world's three largest container shipping companies--Mediterranean Shipping Company (MSC) (Geneva, Switzerland), Maersk A/S (Copenhagen, Denmark) and CMA CGM (France)--have suspended cargo shipments to and from Russia.
Russia produces 11% of the world's wheat and is its largest exporter; Russia and Ukraine together export more than a quarter of the world's supply, according to Axios. The United States Department of Agriculture's (USDA) March World Agricultural Supply and Demand Estimates (WASDE) report provides a forecast for U.S. and global supply and consumption of agricultural products for crop year 2021-22 (July 1, 2021 to June 30, 2022), shedding light on the conflict's potential impact: "Russia's recent military action in Ukraine significantly increased the uncertainty of agricultural supply and demand conditions in the region and globally," although the report "represents an initial assessment of the short-term impacts as a result of this action."
The USDA forecasts a 5 million-bushel drop in U.S. wheat imports for the crop year, and expects Russia's global wheat exports to drop 3 million tons to 32 million, as "vessel transportation is expected to be constrained by the conflict and the imposition of economic sanctions." Ukraine's exports could drop 4 million tons to 20 million as long as exports from the Black Sea region are disrupted. On March 7, wheat futures climbed to a record $12.94 per bushel.
The U.S.' supply of a key material in making semiconductors, neon, comes almost entirely from Ukraine and Russia. For more information, see Industrial Info's March 2, 2022, article - Ukraine Conflict Could Nip Critical Neon Supplies for Microchip Makers, and February 28, 2022, article - Invasion of Ukraine Could Heighten Strain on Semiconductor Supply.
Industrial Info is tracking $224.5 billion worth of active projects in the U.S. Industrial Manufacturing Industry that are under construction. Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project Database can click here for a detailed list.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: LinkedIn.
The ISM's February Purchasing Managers Index (PMI) registered 58.6%, an increase of 1.0 percentage point from the January reading, indicating expansion in the overall economy for the 21st month in a row, Timothy Fiore, chair of the ISM's Manufacturing Business Survey Committee, said in a press release.
"The impact of omicron declined in February as swiftly as it appeared in December, leaving March and April's manufacturing environment favorable, especially with new orders and backlogs registering strong growth," Fiore said. The indexes for new orders and the order backlog increased 3.8 and 8.6 percentage points, respectively, compared with January.
Companies surveyed for the report expressed positivity amid ongoing issues. Fiore said: "The U.S. manufacturing sector remains in a demand-driven, supply chain-constrained environment (...) A higher-than-normal quits rate and early retirements continued," but added, "Panel sentiment remained strongly optimistic, with 12 positive growth comments for every cautious comment, up from January's ratio of 7-to-1."
However, the survey was conducted before Russia's invasion of Ukraine, which could hurt U.S. manufacturing activity that is still being impacted by supply-chain issues. The PMI covers 18 industry sectors, ranging from computer and electronic products to food, beverage and tobacco products.
The conflict is wreaking havoc on an already-battered global supply chain, in which maritime shipping accounts for 80% of the world's trade. Ukraine has closed its ports, and the world's three largest container shipping companies--Mediterranean Shipping Company (MSC) (Geneva, Switzerland), Maersk A/S (Copenhagen, Denmark) and CMA CGM (France)--have suspended cargo shipments to and from Russia.
Russia produces 11% of the world's wheat and is its largest exporter; Russia and Ukraine together export more than a quarter of the world's supply, according to Axios. The United States Department of Agriculture's (USDA) March World Agricultural Supply and Demand Estimates (WASDE) report provides a forecast for U.S. and global supply and consumption of agricultural products for crop year 2021-22 (July 1, 2021 to June 30, 2022), shedding light on the conflict's potential impact: "Russia's recent military action in Ukraine significantly increased the uncertainty of agricultural supply and demand conditions in the region and globally," although the report "represents an initial assessment of the short-term impacts as a result of this action."
The USDA forecasts a 5 million-bushel drop in U.S. wheat imports for the crop year, and expects Russia's global wheat exports to drop 3 million tons to 32 million, as "vessel transportation is expected to be constrained by the conflict and the imposition of economic sanctions." Ukraine's exports could drop 4 million tons to 20 million as long as exports from the Black Sea region are disrupted. On March 7, wheat futures climbed to a record $12.94 per bushel.
The U.S.' supply of a key material in making semiconductors, neon, comes almost entirely from Ukraine and Russia. For more information, see Industrial Info's March 2, 2022, article - Ukraine Conflict Could Nip Critical Neon Supplies for Microchip Makers, and February 28, 2022, article - Invasion of Ukraine Could Heighten Strain on Semiconductor Supply.
Industrial Info is tracking $224.5 billion worth of active projects in the U.S. Industrial Manufacturing Industry that are under construction. Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project Database can click here for a detailed list.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: LinkedIn.
