South African factories running at four-fifths capacity
Lack of demand was the main reason SA’s large manufacturing facilities left 19% of their capacity unused in the third quarter
The average large South African factory used 81% of its capacity in the third quarter, Stats SA reported on Thursday. This indicates a slight uptick from the second quarter’s 80.6% utilisation. Stats SA splits the reasons for under-utilisation of manufacturing capacity into four categories. The main reason for factories not running at full output was lack of demand, accounting for 11.7% of the 19% not utilised. “Other” was the second biggest problem, accounting for 4.1%, while raw material and lack of skilled people each contributed 2%.
Of the 10 industries Stats SA splits its quarterly manufacturing utilisation report into, textile and clothing factories had the lowest utilisation at 72.3%, and petroleum and plastic plants the highest at 83.8%. Seven of the 10 industries showed annual declines in utilisation. Electronics factories suffered most with a drop of 4.5 percentage points to 80.5%, followed by food and beverage factories which fell 1.9 percentage points to 80.8% util...