TAIPEI:The Ministry of Economic Affairs said that domestic commercial sales were down 3% due to declining revenue in the wholesale sector
Industrial production this month is likely to be flat or decline from last month, after the nation posted a second consecutive month of annual decline in output last month, the Ministry of Economic Affairs said here the other day.
Industrial production dropped 1.35 percent year-on-year last month, following an annual decline of 3.17 percent in May, the ministry said in a report.
“Industrial production momentum appears to be remaining soft because of high inventory levels in the semiconductor and flat-panel industries, so we do not rule out seeing another annual decline this month,” Department of Statistics Deputy Director-General Yang Kuei-hsien said.
Citing the ministry’s monthly survey of local manufacturers, Yang said the inventory-to-sales ratio for the manufacturing sector is about 70 percent, higher than a healthy level of between 60 percent and 65 percent.
In addition, local manufacturers also face uncertainties over orders in Europe and slower economic growth in emerging markets, Yang said.
“The pace of inventory digestion in the manufacturing sector will also play a key role in whether the nation’s industrial production turns from an annual decline to an increase this quarter,” Yang added.
The report indicated improvements in the production of semiconductor testing devices and optical components, but output of the electronic components industry — integrated circuit substrates, flat panels, LED chips, computer electronics goods and optical components — were still on the decline last month.
Separately, domestic commercial sales dropped for a fourth straight month last month, down 3 percent to NT$1.197 trillion (US$38.06 billion) from a year earlier, affected by declining revenue in the wholesale sector, the ministry said in a separate report.
This saw commercial sales last quarter plunge by 3.1 percent annually to NT$3.533 trillion, the ministry said.
The wholesale sector, which accounted for 69.09 percent of all commercial sales, saw revenue drop 4.5 percent annually to NT$826.9 billion last month, mainly due to declining purchases from Japan and weak demand for building materials, Yang said.
Sales in the retail sector grew 0.4 percent to NT$334.3 billion last month from a year earlier, driven by an increasing number of chain operators and Dragon Boat Festival sales promotions.
Revenues in the food and beverage sector increased 0.9 percent annually to NT$35.6 billion last month, the ministry said.
Yang said the outlook for the food and beverage, and retail sectors remains positive this month, but the wholesale sector faces lower purchases from Japan.
