Logistics and manufacturing: Panjiva data in line with recent positive economic signs
Jeff Berman, Group News Editor -- Logistics Management, 9/9/2009
NEW YORK—Recent data from Panjiva, an online search engine with detailed information on global suppliers and manufacturers, corroborates economic indicators that suggest the economy is in recovery mode, albeit a slow one.
According to Panjiva, global trade activity “held steady,” with a 1 percent increase from July to August in the number of global manufacturers shipping to the U.S. market. This July to August output is similar to recent years, which saw a 1 percent decrease in both 2008 and 2007. Panjiva also noted that from July to August there was a 1 percent increase in the number of U.S.-based companies receiving waterborne shipments from overseas.
While a sequential increase is positive, this most recent data comes up short when compared to the June to July numbers which saw a 7 percent spike.
Panjiva CEO Josh Green told LM in an interview he is “cautiously optimistic” regarding this recently- and previously-released data.
“Each month that goes by where we see that things are holding steady gives us confidence that the [economic] recovery is, in fact, underway,” he said. “But it does not feel like we are on the path to a fast and steep recovery. And the next couple of months—as we head into the holiday season—will be telling.”
On an anecdotal basis, Green said it appears that corporate buyers are being cautious and careful because having too much inventory when the economy soured last year put them in a tough position. Now, he said, they have learned from the past and are comfortable having less inventory than more.
Like in the past, an economic recovery is more than likely to be led by consumers, said Green.
“It has to start with consumers…everyone is tying their own purchasing decisions to their impressions of how consumers feel about the economy,” said Green. “It feels like the sense of panic regarding the economy is gone now…but the recovery will not be as dramatic as the decline was, but that may put us on a path to a more sustainable recovery.”
As LM has previously reported, there have been various signs of positive economic activity, including:
· the Institute of Supply Management’s manufacturing index—the PMI—which covers the overall health of the manufacturing sector, rose four percentage points to 52.9 percent, marking the first time the index has climbed above 50 since the recession began—the 50 percent mark is typically viewed as the dividing line between “growth” and “contraction”;
· the Department of Commerce’s recent report that durable goods orders were up by its largest amount in two years, with a 4.9 percent bump, that has seen the increase up in three of the last four months; and
· the Cass Information Systems Freight Index, which measures freight expenditures and payables, was up 1.3 percent in August compared to July.
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