Drop in domestic demand curtails industrial production

In May the volume of industrial production decreased by 6.9% compared to the same period of the previous year.

Industrial output in May – according to seasonally and working-day adjusted indices – was 1.6% above the level of the previous month.

The volume of industrial export was 0.3% higher than a year earlier. Transport equipment export, representing a 33% weight within export sales in manufacturing rose by 14.6%, the export in manufacture of electronical equipment, accounting for a 15% weight, went up by 25%.

Domestic sales of industry fell by 18.4%, those of manufacturing lessened by 11.4% compared to the same month of the previous year. Within industry, manufacturing output, which accounts for a decisive share in industry (96%), declined by 5.0%, that of mining and quarrying, having a small weight, fell by 33%, production in energy industry (electricity, gas, steam and air conditioning supply) dropped by 32%.

The manufacture of transport equipment, representing 26% of the manufacturing production (having the largest weight), grew by 10.5% compared to the same month of the previous year. Motor vehicles manufacturing rose by 10.1%, the manufacture of parts and accessories for motor vehicles went up by 11.0%.

The manufacture of electrical equipment having a 12% weight in manufacturing was 13.4% higher year-on-year. Out of the two largest weight representing groups the manufacture of batteries and accumulators went up by 33%, the manufacture of electric motors, generators, transformers and electricity distribution and control apparatus decreased by 5.9%.

The manufacture of computer, electronic and optical products accounting for 9% of manufacturing dropped by 6.9% compared to the same month of the previous year. Out of the two largest groups, the manufacture of consumer electronics declined by 7.5%, the manufacture of electronic components and boards fell by 9.4%.

The manufacture of food products, beverages and tobacco products having a 12% share in manufacturing dropped by 16.7% year-on-year, owing to a fall in both domestic and export sales. Output grew in only two groups: the manufacture of tobacco products, by 15.4% and the bakery and farinaceous products, by 3.1%. The processing and preserving meat and the production of meat products representing the largest weight (23%) dropped by 13.5% year-on-year. Production decreased between 11.1% and 47% in the other eight groups, least of all in the manufacture of other food products, including the manufacture of cocoa, chocolate and sugar confectionery, to the greatest extent in the processing and preserving of fish, crustaceans and molluscs.

Out of the two medium-weight representing subsections the manufacture of rubber and plastics products, and other non-metallic mineral products dropped at the highest rate within the subsections, by 25%, the manufacture of basic metals and fabricated metal products fell by 15.4% compared to the same month of the previous year. Within the latter, the volume declined even more in the division of metallurgy (manufacture of basic metals).

After a two-months long decrease the output in manufacture of pharmaceuticals, medicinal chemical and botanical products, having a smaller weight, grew by 6.7%, first of all due to an increase in export sales, while domestic sales lessened.

The manufacture of chemicals and chemical products lagged behind the previous year’s value by 20%, a significant decline was recorded in the great majority of the classes.

Industrial production increased only in Pest region (by 2.7%). In the other regions volume decreases 0.7% and 13.9% were recorded, the highest one in Northern Hungary.

The volume of total new orders in the observed divisions of manufacturing was 0.5% lower compared to May 2022. New domestic orders dropped by 9.3%, new export orders grew by 1.1%. The total stock of orders at the end of May was above the previous year’s level by 8.5%.

In January–May 2023, compared to the same period of the previous year, industrial production decreased by 4.8%. The volume of export sales, representing 59% of all sales declined by 0.7%, domestic sales accounting for 41% of all sales fell by 16.7%. Out of the thirteen subsections of manufacturing production declined in eight, to the greatest extent, by 26%, in the manufacture of coke, and refined petroleum products. In the other five ones production volume increased between 0.5% and 24%, mostly in the manufacturing of electrical equipment, while the output in the manufacture of transport equipment, considered to be the largest subsection, went up by 14.2%.