All references to sales movements are seasonally adjusted unless otherwise stated.
Total sales
Total manufacturing sales decreased 0.6 percent ($132 million) in the June 2008 quarter, following increases in the previous two quarters. These changes reflect rises and falls in the meat and dairy product manufacturing industry. This industry accounts for over one-quarter of total manufacturing sales and showed a fall in the latest quarter, following a record two-quarter rise.
Decreases in sales values occurred in six of the 15 published industries in the June 2008 quarter. The largest decrease was in the meat and dairy product manufacturing industry, down 8.9 percent ($572 million), followed by the wood product manufacturing industry, down 4.5 percent ($51 million).
Increases in sales values occurred in nine published industries in the June 2008 quarter. The largest increase was in the basic metal manufacturing industry, up 27 percent ($177 million), followed by the transport equipment manufacturing industry, up 14 percent ($94 million).
The manufacturing sales trend continues to rise. However, the latest figures indicate an easing in the growth rate, following three quarters of relatively strong increases.
The manufacturing sales volume decreased 1.0 percent in the June 2008 quarter, following a decrease of 0.2 percent in the March 2008 quarter, and an increase of 3.6 percent in the December 2007 quarter.
Volumes are calculated by removing the effect of price change from values.
Stocks
The unadjusted value for closing stocks of finished goods is up 10 percent ($783 million) for the June 2008 quarter compared with the same quarter a year earlier. Meat and dairy product manufacturing contributed most of this change, with an increase of 22 percent ($574 million). The March 2008 and December 2007 quarters showed increases of 14 percent and 13 percent, respectively, compared with the same quarters a year earlier.
The unadjusted volume of finished goods stocks is down 3.1 percent ($187 million) for the June 2008 quarter compared with the same quarter a year earlier, reflecting lower stock volumes in the meat and dairy industry.
All manufacturing excluding meat and dairy product manufacturing
For the June 2008 quarter, all manufacturing sales excluding the meat and dairy product manufacturing industry had an increase of 3.1 percent ($439 million), following a decrease of 0.2 percent ($22 million) in the March 2008 quarter.
Basic metal manufacturing, up 27 percent ($177 million), and transport equipment manufacturing, up 14 percent ($94 million), contributed over half the June quarter rise. The main falls were in wood product manufacturing, down 4.5 percent ($51 million) and textile and apparel manufacturing, down 4.9 percent ($29 million).
The sales volume rose 1.8 percent in the June 2008 quarter, following a fall of 1.4 percent in the March 2008 quarter.
The sales trend continues to generally move upward, and has risen 20 percent since the June 2003 quarter.
Meat and dairy product manufacturing
A sales decrease of 8.9 percent ($572 million) was recorded for the meat and dairy product manufacturing industry in the June 2008 quarter. This is the largest percentage decrease in almost 10 years and offsets some of the large rise of 40 percent ($1,827 million) during the previous two quarters.
Meat and dairy product manufacturing volumes fell 9.4 percent in the June 2008 quarter, after rising in the previous two quarters. The latest fall reflects a drop of 17 percent in the seasonally adjusted exported volume of dairy products in the June 2008 quarter, as shown in the Overseas Trade Indexes (Volumes) release. Meat prices rose 5.9 percent in the June 2008 quarter, while dairy prices eased 0.4 percent after a 52 percent rise across the previous five quarters, according to industry outputs in the Producers Price Index release.
Stocks of finished goods, which are not seasonally adjusted, dropped 16 percent from the March 2008 quarter high-point, but are up 22 percent on the June 2007 quarter. Stocks typically rise in the December and March quarters then fall in the following two quarters.
The sales trend for the meat and dairy product manufacturing industry shows a decrease for the June 2008 quarter, following three quarters of rises totalling 31 percent. However, these movements are only indicative at this stage and may be revised in future quarters.
Wood product manufacturing
The wood product manufacturing industry consists of log sawmilling, wood chipping, timber re-sawing and dressing, and the manufacture of plywood and veneer, fabricated wood and wooden structural components. The industry comprises a mix of exported wood commodities and domestic wood manufacturing sales.
Sales by the wood product manufacturing industry fell 4.5 percent ($51 million) in the June 2008 quarter, following falls in the previous two quarters. The decreases in these three quarters total 13 percent ($160 million). Volumes continued to fall, down 3.8 percent for the June 2008 quarter, and down 11 percent across the previous three quarters.
Output prices, as measured by the Producers Price Index, fell 1.3 percent during the three quarters to June 2008, while the value for stocks of finished goods, which is not seasonally adjusted, rose 15 percent during the latest two quarters.
The sales trend shows a fall for the three quarters to June 2008, following increases in 2006 and 2007.
Basic metal manufacturing
The basic metal manufacturing industry includes the manufacture of iron and steel, basic non-ferrous metals, and non-ferrous basic metal products.
Sales by this industry do not have a stable seasonal pattern, so are not seasonally adjusted.
Sales by the basic metal manufacturing industry rose 27 percent ($177 million) in the June 2008 quarter, following a rise of 6.9 percent in the March 2008 quarter, and a fall of 10 percent in the December 2007 quarter. Volumes rose 22 percent in the June 2008 quarter and 6.1 percent in the March 2008 quarter, and fell 10 percent in the December 2007 quarter.
Output prices, as measured by the Producers Price Index, rose 3.5 percent in the June 2008 quarter. Stocks of finished goods, which are not seasonally adjusted, decreased 5.1 percent during the latest two quarters, while stock volumes dropped 9.1 percent.
Transport equipment manufacturing
The transport equipment manufacturing industry includes the manufacture and repair of a variety of transport equipment including ships, locomotives and aircraft.
Sales by this industry do not have a stable seasonal pattern, so are not seasonally adjusted.
Sales by the transport equipment manufacturing industry rose 14 percent ($94 million) in the June 2008 quarter, following a fall of 5.0 percent in the March 2008 quarter. Volumes rose 11 percent in the June 2008 quarter, fell 6.3 percent in the March 2008 quarter, and showed rises totalling 23 percent for the June to December 2007 quarters.
Output prices, as measured by the Producers Price Index, rose 4.7 percent in the latest two quarters, while the value for stocks of finished goods decreased 12 percent.
The sales trend shows a rise for the latest five quarters, increasing 22 percent since the March 2007 quarter.
Measurement errors
The Economic Survey of Manufacturing applies imputation methods for estimating values for small firms and non-response, and, like all statistical surveys, is subject to measurement errors, including sample errors and non-sample errors. These measurement errors affect the accuracy of the published statistics. For more information on measurement errors, please refer to the Technical notes of this release.
Sample errors
The postal survey was designed to give statistics at the following levels of accuracy (at the 95 percent confidence interval limit):
- 5 percent for sales, salaries and wages, and value added at the total manufacturing level
- 10 percent for sales, salaries and wages, and value added at the published industry level, where value added is calculated as follows:
value added = sales – purchases + stock change
This means, for example, that there is a 95 percent chance that the true value of total manufacturing sales lies within 5 percent of the published estimate.
Sample errors are calculated each quarter for absolute values and for changes in value from the previous quarter.
The sample errors for the June 2008 quarter, at the 95 percent confidence interval limit, are:
| Industry |
Sample error for sales |
Sample error for change in sales |
| |
Percent |
| Meat and dairy product manufacturing |
0.0 |
0.0 |
| Other food manufacturing |
9.2 |
7.7 |
| Beverage, malt and tobacco manufacturing |
0.0 |
0.0 |
| Textile and apparel manufacturing |
6.0 |
2.4 |
| Wood product manufacturing |
4.1 |
3.4 |
| Paper and paper product manufacturing |
0.0 |
0.0 |
| Printing, publishing and recorded media |
6.4 |
5.5 |
| Petroleum and industrial chemical manufacturing |
0.0 |
0.0 |
| Rubber, plastic and other chemical product manufacturing |
12.5 |
5.5 |
| Non-metallic mineral product manufacturing |
3.3 |
1.1 |
| Basic metal manufacturing |
0.0 |
0.0 |
| Structural, sheet and fabricated metal product manufacturing |
5.9 |
5.4 |
| Transport equipment manufacturing |
4.6 |
2.7 |
| Machinery and equipment manufacturing |
3.3 |
4.1 |
| Furniture and other manufacturing |
4.4 |
2.3 |
| Total manufacturing |
1.4 |
1.0 |
Industries with zero sample error are full-coverage industries. In these industries all large firms are surveyed and all small- to medium-sized firms are modelled using administrative data from Inland Revenue.
Imputation
Small firms
Small- to medium-sized firms are generally not surveyed. Their variables are instead modelled from administrative data from Inland Revenue. Ratios calculated from the postal sample responses are applied to the administrative data to provide estimated values.
Non-response imputation
Although attempts are made to achieve a 100 percent response rate, in practice this does not occur. Values for non-responding businesses are estimated using a range of methods, including:
-
regression imputation
-
historic imputation
-
mean imputation.
Regression imputation involves estimating the variable of interest from the unit's administrative data (GST sales), based on the relationship shown by similar businesses. Historic imputation involves multiplying their response in the previous period by a non-response factor. The non-response factor is the average movement over the quarter of similar businesses. Mean imputation involves estimating a value for a unit by using the average value for a set of similar businesses.
The table below indicates the percentage of sales that was imputed in the June 2008 quarter:
| Industry |
Non-response |
Tax modelled |
| |
Percentage of sales |
| Meat and dairy product manufacturing |
0.4 |
2.6 |
| Other food manufacturing |
4.8 |
4.8 |
| Beverage, malt and tobacco manufacturing |
5.3 |
6.1 |
| Textile and apparel manufacturing |
11.6 |
16.7 |
| Wood product manufacturing |
11.2 |
9.2 |
| Paper and paper product manufacturing |
0.8 |
0.9 |
| Printing, publishing and recorded media |
9.9 |
10.4 |
| Petroleum and industrial chemical manufacturing |
4.8 |
5.0 |
| Rubber, plastic and other chemical product manufacturing |
11.0 |
7.8 |
| Non-metallic mineral product manufacturing |
16.6 |
6.4 |
| Basic metal manufacturing |
4.1 |
3.6 |
| Structural, sheet and fabricated metal product manufacturing |
19.5 |
11.0 |
| Transport equipment manufacturing |
13.9 |
10.5 |
| Machinery and equipment manufacturing |
14.8 |
12.3 |
| Furniture and other manufacturing |
13.8 |
24.0 |
| Total manufacturing |
7.2 |
6.8 |
Response rate
The response rate applies to the postal sample and gives the proportion of sales obtained from survey responses (compared with being imputed). The Economic Survey of Manufacturing has a target response rate of 85 percent. The response rate achieved for the June 2008 quarter was 91 percent.
For technical information contact:
John Gudgeon or Jason Fullen
Christchurch 03 964 8700
Email: subannuals@stat.govt.nz
Next release ...
Economic Survey of Manufacturing: September 2008 will be released on 15 December 2008