November 2010 ISM Reports

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With a 0.3 percentage point decrease (to 56.6 percent) in its PMI, manufacturing expanded at a slightly slower pace in November, according to the Institute for Supply Management (ISM). "The manufacturing sector grew during November, with both new orders and production continuing to expand,” said Norbert Ore, chair of ISM’s Manufacturing Business Survey Committee. “With the PMI at 56.6 percent, November's rate of growth is the second fastest in the last six months [but well off the pace seen between March and May]. Exports and imports continue to support expansion in the sector. Prices moderated slightly during the month, but comments from the respondents express concerns with regard to pricing pressures. The list of commodities in short supply increased, though short supply items are not yet posing significant problems. Manufacturing continues to benefit from the recovery in autos, but those industries reliant upon housing continue to struggle."

Wood Products reported no change in November, while the only real bright spots for Paper Products involved rising new export orders and slowing imports.
 

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The pace of growth of the non-manufacturing sector picked up in November, thanks to a 0.7 percentage point (to 55.0 percent) increase in its NMI/PMI. Construction was the only service industry among those we track to share in that expansion, however. Like Wood Products, Real Estate was unchanged for a second month; Ag & Forestry contracted.

Input prices of both manufacturers and service industries rose at a slower pace, which is surprising in light of the lengthening lists of commodities reportedly up in price. E.g., caustic soda, chemicals, corrugated containers, fuel and paper were among the commodities up in price. The only relevant commodity down in price was paper rolls. Coated freesheet and coated groundwood were described as in short supply.