Industrial production, manufacturing output increased less than 1% in February

Industrial production rose 0.6% in February after declining 0.5% in January, according to the Federal Reserve.

The Federal Reserve recently released data on industrial production and capacity use for February.

Manufacturing output increased by 0.1% in February, from January. Excluding a rise in motor vehicles and parts and a decrease for civilian aircraft, factory output was flat. The index for mixing fell 1.5%, but the index for utilities increased 7.1% as temperatures returned to more typical levels after a warm January. The level of total industrial production was flat in February, from the same month in 2019. The production was at 109.6% of its 2012 average.

Capacity use for the industrial sector rose 0.4 percentage points to 77% in February. The rate is 2.8 percentage points below its long-run (1972-2019) average.

The index for consumer goods increased by 1.7% in February. Automotive products and energy products increased along with several other categories. The output of business equipment fell 0.4% as a result of a decline in transit equipment and a reduction in the production of civilian aircraft. The index for construction supplies fell 0.4%, while the indexes for defense and space equipment and business supplies rose 1.2% and 0.5%, respectively. The output of materials increased by 0.2% as a rise in the energy category more than offset declines for durable and nondurable materials.

Manufacturing output fell 0.4% in February, from the same month in 2019. The output of durable goods increased 0.3%. Among the components of durables, motor vehicles and parts increased, while aerospace and miscellaneous transportation equipment declined. The output of nondurable manufacturing declined 0.1% as its components had mixed results. Textile and product mills, petroleum and coal products and chemicals all decreased, while food, beverage and tobacco products; apparel and leather; and printing and support increased. The output of other manufacturing, including publishing and logging, fell 1% and was 9% below its level in February 2019.

Mining output declined 1.5% in February, and its components declined broadly. But overall mining production was 2.1% above its level in February 2019. The output of utilities increased, with electric and natural gas utilities rising.

Capacity use for manufacturing was 75% in February, flat from January, and 3.2 percentage points below its long-run average. The use rate for mining fell to 88.4% but was 1.2 percentage points above its long-run average. The operating rate for utilities increased to 75.8%, and the rate is 9.4 percentage points below its long-run average.

SALES AND SHIPMENTS
The combined value of distributive trade sales and manufacturers’ shipments, adjusted for seasonal and trading day differences but not for price changes, rose 0.6% to $1.47 trillion in January, from December, according to the U.S. Census Bureau. The value increased by 2.1% from January 2019.

The Census Bureau recently announced the manufacturing and trade statistics for January.

Manufacturers’ and trade inventories, adjusted for seasonal variations but not for price changes, fell 0.1% in January, from December. The inventories rose 1.1%, from January 2019. The total business inventories/sales ratio based on seasonally adjusted data was 1.38 at the end of January. The January 2019 ratio was 1.40.