December's producer confidence was notably below the long-term average of 1, a stark contrast to the all-time high of 12.7 recorded in November 2021 and far from the all-time low of minus 28.7 in April 2020. This decline in confidence was most pronounced in the textile, clothing, and leather industries, where it fell by 4.7 per cent.

The deterioration in manufacturers' outlook was evident across three key areas: order positions, expected output, and current stocks of finished products. The majority of manufacturers are bracing for a decrease in output over the coming months, a sentiment that aligns with their views on current stock levels, which they predominantly consider to be higher than ideal. Additionally, the prevailing opinion among manufacturers is that their order positions are weaker than desirable for this time of year, as per CBS.

Over half of the producers see minimal or no consequences from the current economic conditions. However, more than a quarter reported that increased financing costs are exerting pressure on profitability. Additionally, just over 7 per cent noted that reduced borrowing capacity among customers is leading to lower product demand. The remaining 10 per cent cited other impacts, such as heightened difficulties in obtaining financing. These findings are consistent with a similar survey conducted in June 2023, indicating a sustained trend in the industry's sentiment.

Fibre2Fashion News Desk (DP)