Singapore factory output contracted 3.1% in December, weaker than expected on drop in electronics

Singapore – Singapore’s manufacturing output fell for the third month in a row in December. This was dragged down by volatile biomedical production, but the decline was slower than expected.

Data released by the Economic Development Commission on Thursday showed output fell 3.1% in December from a year earlier. Excluding biomedical manufacturing, output increased by 0.3%.

Overall production performed better than the 6.9% contraction forecast by analysts in a Bloomberg poll. It also improved slightly from 3.8%. Fall in November.

Production in October turned negative for the first time in the year due to continued sluggishness in pharmaceutical production and the slump in the core electronics sector.

However, electronics increased 4.6% in December, reversing a 12.4% decline in November and a 0.7% fall in October.

Electronics make up 40% of Singapore’s export-driven manufacturing sector and are key to economic growth.

The Information Communication and Consumer Electronics segment output increased 16.9%, while Computer Peripherals and Data Storage increased 0.9%.

However, semiconductor production continued to shrink, down 0.3%. Meanwhile, the other electronic modules and components segment fell 13.5% on the back of softening demand.

Overall, the electronics cluster output will increase by 2.6% in 2022.

Transportation engineering output also increased by 9.3% in Dec, dragging on November’s 18.6% growth and October’s 6.8% growth.

The aerospace segment grew 27.2% on increased maintenance, repair and overhaul work from commercial airlines on the back of increased global air traffic.

However, marine and offshore engineering fell 0.5% and the land segment contracted 18.6%. The Transportation Engineering cluster grew by 18.8% in 2022 overall.

Other sectors performed poorly in December.

Biomedical manufacturing output fell 20.3%, reversing 9% growth in November.