UK manufacturing exports drop in April

UK manufacturing exports dropped in April, with orders from international clients slowing.

The figures from IHS Markit and the Chartered Institute of Procurement and Supply show that UK manufacturers’ exports declined at the second quickest rate in over four years.

The survey showed that the stockpiling that had begun to prepare for the 29 March Brexit deadline has now slowed, with the deadline pushed back to October.

The slowdown is due in part to the decrease in stockpiling which had increased at the beginning of the year as companies rushed to complete goods and gather supplies of raw materials.

Brexit has been attributed as a significant reason for the decrease, with uncertainty around a disorderly Brexit and falling demand from China, the US and EU.

However, a weakening in the global economy has also impacted UK manufacturing, with orders for overseas competitors also slowing.

Duncan Brock, group director at the Chartered Institute of Procurement and Supply, said: “As Brexit prevarication continued, overseas clients took to action and found new supply-chain routes away from the UK.

“The mild rise in domestic orders was unable to meet this significant shortfall in business, and with the extended Brexit deadline, the levels of stockpiling slowed.”

The PMI (Purchasing Managers Index) dropped to 53.1 in April, after reaching its highest level in over a year in March at 55.1. Figures over 50 are growth, while under 50 represents contraction.

Forecasts predict that economic growth may slow in the UK in the next few months, with companies utilising their stockpiles rather than placing new orders. One in five manufacturers that were surveyed said that they are still stockpiling, with future trade relations with the EU still uncertain.

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Posted in Business.