Published on: 13 February 2018

Industrial production decreased by 0.5%

In December 2017, the volume of industrial output declined by 0.5% year-on-year. Based on working-day adjusted data production grew by 4.5%. Compared to raw data, the significant difference is due to the fact that there were two fewer working days in December 2017 than in December 2016. In 2017, production volume was 4.8% higher than in 2016.

In December 2017:

The volume of industrial production decreased by 0.5% year-on-year. (Compared to the data of December published in the first estimate, there was no change in the data of the second estimate.)

Industrial output – according to the seasonally and working-day adjusted index – was above the previous month’s level by 1.2%.

The volume of industrial export declined by 1.9% compared to the same period of the previous year. Within export sales in manufacturing, the exports of transport equipment – representing 33% rose by 2.8%. At the same time, in the manufacture of computer, electronic and optical products – accounting for 16% of manufacturing exports – export sales grew by 0.2%.

Industrial domestic sales decreased by 0.7%, within this, the domestic sales of manufacturing were 0.2% lower year-on-year.

Production fell in all three sections of industry: by 0.5% in manufacturing representing a decisive weight (94%), by 1.8% in energy industry (electricity, gas, steam and air-conditioning supply) and by 2.0% in mining and quarrying having little weight.

Changes in the production and sales of manufacturing

(%)

Period Production Total Domestic Export Share of export in sales at current prices
sales
Volume index, corresponding period of previous year = 100.0
2015108.0108.2106.7108.774.9
2016101.4101.4101.8101.375.1
2017January106.9106.5102.5107.777.0
February103.1100.296.2101.476.9
March114.6112.7109.8113.676.0
April96.895.396.994.774.4
May109.1110.6106.8112.075.1
June103.9104.1103.7104.275.2
July100.3100.7102.6100.073.1
August106.8106.8104.3107.873.0
September105.8105.2105.4105.275.0
October108.3109.3110.2109.074.7
November103.3102.9102.9102.874.0
December99.598.299.897.670.5
From the beginning of the year104.9104.4103.5104.774.6

The production of transport equipment representing 26% of manufacturing output rose year-on-year by 4.6%. The manufacture of motor vehicles increased by 0.9%, whereas the manufacture of parts and accessories for motor vehicles grew by 8.2%.

The manufacture of computer, electronic and optical products accounting for 11% of manufacturing dropped by 1.4%. Out of the two dominant groups, the larger one: manufacture of communication equipment grew by 12.7%, at the same time the lesser one: manufacture of electronic components and boards decreased by 0.7%. The manufacture of consumer electronics while showing an increase throughout the year fell by 22% in December.

The manufacture of food products, beverages and tobacco products giving 12% of manufacturing declined by 0.5%. Within this, the largest group (representing 26% of the subsection), the processing and preserving meat and the production of meat products increased by 1.2%, while the manufacture of tobacco products having the smallest weight rose at the highest rate of 22%. The manufacture of grain mill products, starches and starch products fell the most by 7.0% compared to the same month of the previous year.

Out of the subsections the manufacture of pharmaceuticals, medicinal chemical and botanical products representing a lesser weight grew the most, by 15.8%, due to an expansion in export sales; domestic sales decreased.

The medium weight representing manufacture of rubber and plastics products, and other non-metallic mineral products rose by 5.9%, while the manufacture of basic metals and fabricated metal products went up by 5.6%, owing to an increase in both domestic and export demand.

After a considerable growth in the previous month, the manufacture of coke, and refined petroleum products – giving 5.6% of manufacturing – declined by 1.6%. The demand declined in both sales directions.

A fall continued in the manufacture of chemicals and chemical products: the volume of production was 10.8% lower in December than a year ago, mostly as a result of a considerable drop in domestic sales of the manufacture of plastics in primary forms.

Following an eleven month growth the manufacture of machinery and equipment n.e.c accounting for 6.7% of the manufacturing output decreased by 22%, primarily due to a significant fall in the manufacture of engines and turbines, except aircraft, vehicle and cycle engines representing more than one quarter weight.

Changes in production in the major subsections of manufacturing, December 2017

(%)

Subsections Volume indices of production, corresponding period of previous year = 100.0 Share of subsection within manufacturing at current prices
code denomination
CAManufacture of food products, beverages and tobacco products99.512.1
CGManufacture of rubber and plastics products, and other non-metallic mineral products105.97.5
CHManufacture of basic metals and fabricated metal products, except machinery and equipment105.68.1
CIManufacture of computer, electronic and optical products98.611.4
CKManufacture of machinery and equipment n.e.c.78.06.7
CLManufacture of transport equipment104.625.7

Along with a 3.5% increase in the number of employees, the labour productivity of industrial enterprises with 5 or more employees was 3.9% lower in December than in the same month of the previous year.

Industrial production rose in three regions – in Southern Transdanubia (4.2%), Western Transdanubia (3.4%), as well as in Southern Great Plain (2.1%). In the other four regions, volume decreases of 0.6% to 5.3% were recorded, the highest fall was observed in Central Hungary.

Total new orders in the observed subsections of manufacturing dropped by 2.6% compared to the same month of 2016. New domestic orders volume increased by 1.9%, while new export orders fell by 2.9%. The volume of total stock of orders was below the level of December 2016 by 10.8%.

In 2017, compared to the previous year:

In 2017, industrial production rose by 4.8%, following the previous year's 0.9% increase. Within this, out of the three sections output practically stagnated in energy industry and grew by 24% in mining and quarrying compared to 2016.

The volume of manufacturing output rose year-on-year by 4.9%. The level of production, (at current prices more than HUF 28 thousand billion), in two months only did not exceed the level of the previous year. The greatest growth was in March (14.6%). Out of the thirteen subsections of manufacturing a decrease was recorded in one subsection only, in manufacture of chemicals and chemical products, volume increases of 1.5% to 12.5% were recorded in all others. Out of the three greatest subsections, in the manufacture of transport equipment, which is considered to be the most significant, production grew by 1.5%, while output of computer, electronic and optical products rose by 8.8%, and that of food products, beverages and tobacco products went up by 2.0%. There were increases in both sales directions in all three subsections.

Industrial export sales grew year-on-year by 5.3% (in 2016, we measured a 0.3% volume increase). Exports accounted for 65% of total industrial sales and for 75% of manufacturing sales. Manufacturing exports rose by 4.7% compared with a year earlier. Two manufacturing subsections gave more than half of all export sales. The export volume of transport equipment representing 35% of manufacturing exports increased by 1.2%, while the second largest subsection, the manufacture of computer, electronic and optical products giving 15% went up by 8.4% in export volume (only in February was a decrease in export volume).

Industrial domestic sales, and within it the domestic sales of manufacturing grew almost at the same rate (by 3.5, and by 3.6% respectively). Domestic sales increased by 1.9% in the manufacture of food products, beverages and tobacco products accounting for 26% of domestic manufacturing sales. The growth continued in domestic sales of the manufacture of basic metals and fabricated metal products accounting for 12.5% of domestic manufacturing (second largest subsection): the volume went up by 8.7 % in 2017.

Labour productivity of industrial enterprises with 5 or more employees went up by 1.4% along with a 3.2% increase in the number of employees.

Industrial production rose in every region of Hungary. The largest volume growth was measured in Northern Great Plain (7.7%), while the lowest in Southern Great Plain (2.6%).