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Monday, June 04, 2007

April Factory Orders

You can get the release here; the full preliminary figures I am discussing are accessible on the left.

The YoY figures contained in the full report are troubling.
We seem to be accumulating inventory rather than exhausting it. Unfilled orders are up 19.9%, but I wonder how real that is. The ratio of unfilled orders to shipments has gone from 4.77 in January to 4.85 for April.

Finished goods for durables are up 5.9% YoY. When I look at these numbers, I think that many industries are going to see a slowdown shortly unless shipments pick up in May.

If this seems like Greek, try Gene Sperling's column.

Aggh: I forgot the most important part. Comparing YTD 2007 to 2006, the value of petroleum and coal product shipments is down 8.7%.

Somehow I doubt we went green that fast. It is true that building is high energy, but so is farming, which is up strongly (shipments of ag chemicals up 11.9% YTD compared to 2006 YTD) now that we decided to burn corn. Manufacturing is high energy. We had some cold winter months, which pushed utility production up. It's hard to see how petroleum and coal shipments can be down that much. To my mind, there are only two possible answers. The first is that the sampling procedure (this report comes from a sampling of companies) is such that it is overstating production. The second is that the sampling procedure is such that energy shipments are being understated. That is unlikely, because energy is dominated by large companies.

[Comparing YTD 2007 to 2006, the value of petroleum and coal product shipments is down 8.7%.]

Do you have a source or link for this data?
Use the link. On the left, select the format of your choice for preliminary highlights. I use the pdf. On page 2 of the pdf you will see a table of manufacturer's shipments broken out by industry group. On the right it gives the NSA numbers and YTD comparisons YoY (which are, of course, NSA because they compare the same period across years).
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