After three consecutive monthly decreases to start the year, business conditions for North American moldmakers registered some improvement in recent weeks. The Mold Business Index (MBI) for April is exactly 50.0. This is a 13.4-percentage point increase from the weak March value of 36.6. A solid gain in the New Orders component was offset by longer Supplier Delivery Times and much higher Materials Prices. The noticeable uptrend in business levels also resulted in a sharp rise to 67.9 in the Future Expectations component.
The sub-index for New Orders of molds posted a solid 57.1 in April. Production levels showed a modest improvement, as the latest Production sub-index was 51.8. The Employment component was also 51.8, which means that there was a small increase in overall payrolls last month. Yet despite the rise in new orders and the steady pace of production, moldmakers still report a decrease in backlogs. The Backlog component was 44.6 in April.
The Mold Prices sub-index for the latest month was 41.1. This means that the prices received for new molds were lower. At the same time, the prices paid for materials increased again sharply as the latest sub-index for Materials Prices was 82.1. Supplier Delivery Times are longer, as this sub-index posted a value of 42.9. There was also a small increase reported in the number of offshore orders for new molds, as the Export Orders sub-index was 51.8.
Our Injection Molding Business Index (a measure of production levels for injection molders) declined by 7 percent in the first quarter of 2008 when compared with the previous year. This indicator was flat for all of last year, but after a slow start to 2008, a rise of 3 to 4 percent in market demand for injection molded products is forecast for the second half of the year. Consistent gains in the Mold Business Index depend on sustained growth of 4 to 5 percent in the output of injection molded products. The trend in the moldmaking industry lags the trend in the processing sector by about six months.