The SME industry grew 4.8% annually in February

The SME industry grew 4.8% annually in February

The production of the manufacturing industry SMEs increased 4.8% in February compared to the same month last year, at constant prices. Compared to January, it also had a positive variation, reaching 1.2%.

The use of installed capacity of the companies in the sample fell slightly, to 71.7%, that is, 0.9 percentage points below January. It is the second month where production growth is combined with less use of facilities, a phenomenon that is explained by higher levels of investment in different industrial sectors, especially in Food and Beverages.

This February was greatly affected by cost increases. Delays in the deliveries of inputs by suppliers and doubts by some companies when accepting new production orders, for fear of failing to comply with delivery times, are among the patterns observed.

Some firms also advance the manufacturing stock. For exporting companies, customer demands on deadlines and costs generate uncertainty.

These results arise from the SME Industrial Production Index (IPIP) prepared by CAME, with a sample that reached some 372 SME industries at the federal level.

Sectorial analysis

The best performance in the annual comparison, in February, was in Wood and Furniture (+9.2%) and the worst occurred in paper and printing (-7%). Of the six sectors measured, 4 ended with growth and 2 with declines in production.

Food and drinks

Production increased 8.1% annually in February and 2.8% monthly at constant prices. In this way, it accumulates a development of 6.6% in the first two months of the year. The use of installed capacity fell from 80.1% in January to 73.5% in February, being one of the sectors with the most investment. There was good demand and the companies stated that they could not take all the orders due to lack of production capacity and human resources to expand the offer.

“We are producing at an optimal level, we hope that in the coming months we will continue like this,” said the owner of a company in the city of Malagueños, in Córdoba, dedicated to the production of alfalfa in bales, mega-bales and pellets.

“We have more demand than we are able to cover, we need to expand our production capacity,” was the response of a businesswoman dedicated to the manufacture of industrial baked goods in the city of Santiago del Estero.

clothing and textile

Activity fails to pick up. In February, production fell another 5.1% annually and adds a drop of 4.4% in the first two months of the year compared to the same period in 2022. The use of installed capacity rose 1.4 points, to 73%.

Within this industrial branch, companies dedicated to the manufacture of school uniforms did very well, which had better demand than at this time last year, when the school year was not yet fully normalized.

“February was very bad, the difficulties in accessing imported raw materials continued and union conflicts were added in the companies that provide us with inputs,” they said from a Morón workshop in Greater Buenos Aires.

“Production is stable, similar to last year, which was not very good. We are also incorporating new machinery to improve the company’s productivity,” they commented from a factory in Las Breñas, in the province of Chaco.

Woods and Furniture

Production rose 9.2% annually in February and 3.5% monthly, at constant prices. In the first two months of the year it has grown 7.4% per year.

The use of installed capacity increased 2.6 points, to 75%, which is to be expected because the sector has been making investments since previous months and comes from a 2022 very complex. The firms state that they have orders placed for the next six months which, at least in terms of production, assure them of a good 2023.

“January was bad and in February it began to move. We managed to take jobs that lasted several months,” they reported from a furniture factory in San Roque, in Mendoza.
“Luckily February was a good month, there were more orders than usual, we really did not expect it and it is repeating itself in March,” they said from a factory in the city of La Rioja.

Metal, machinery, equipment and transport material

The item increased 6.9% annually in February at constant prices and 1.2% monthly. In the first two months of the year, it grew 6.3% compared to the same period in 2022. The sector used 2.4 points more of its installed capacity than in January, reaching 69.9%.

The companies are working well, with active demand, although with many difficulties due to the increase in costs in the first two months of the year. Added to this are delays in input deliveries, which some companies assign to suppliers who speculate on prices. The good performanceThe exporting pattern of the automotive industry in recent months has attracted some local suppliers.

“At this time of year sales are still low, in March everything returns to normal, but it was still better than in 2022,” they transmitted from an SME in the City of Buenos Aires.
“This year we are very active, participating in business rounds and trade missions to find new clients,” they highlighted from a machinery factory in the city of Santa Fe that had a good start to the year.

Chemicals and plastics

Production grew 5.3% annually in February, at constant prices, and fell 0.2% in the monthly comparison. In the first two months of the year, it increased 5.4% compared to the same period in 2022.

The use of installed capacity remained practically unchanged at 68.9%, still a relatively low level, although there are companies that claim to be working at 100% of their possibilities. The rest was between fair and bad. The branch continues to be greatly affected by the rise in raw materials and the lack of accessible financing for machinery replacement.

“The lack of raw material causes many industries to find themselves paralyzed and laying off people. We do not understand how imported products come to the shelves when many companies are not approved by the SIRA, which are essential to maintain production,” an industry complained. from La Tablada, in the Province of Buenos Aires.

“There are difficulties in finalizing sales, we believe that this is happening due to uncertainty and inflation,” they said from a plastic products factory in the city of Formosa.

Paper, cardboard, editing and printing

Activity fell 7% annually in the second month of the year (at constant prices) and fell 0.7% in the monthly comparison. In the first two months of the year, it accumulates a fall of 6.7% compared to the same period of 2022. The use of installed capacity fell 3.8 percentage points, to 73.7%.

The companies expected that February It was a good month, hand in hand with the beginning of the school year especially, but it did not happen. Now the expectations are set on the impact of the electoral cycle.“We no longer know for sure how sales are going to evolve, we just hope that at least they don’t continue to decrease,” they said from a company in the city of Comodoro Rivadavia.

“The activity is very bad, but we believe that this year will be good because it is electoral. Since April we hope to improve,” they said from an SME in the city of Posadas, in Misiones.

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