Industrial production grows 9th straight month in January (update)

Taipei, Taiwan recorded year-on-year growth in industrial production for the ninth consecutive month in January, helped largely by a relatively low base of comparison with last year, the Ministry of Economic Affairs (MOEA) said Monday.

The industrial production index for January rose 10.86 percent from a year earlier to 115.98, a new monthly high, after a 1.37 percent year-on-year increase recorded in December, according to the MOEA.

The strong growth benefited not only from strong global demand but also from a low base of comparison against January 2017, as last year's Lunar New Year holiday fell in January, resulting in a reduced number of working days, the MOEA said.

The holiday fell in February this year, meaning that January had its full complement of working days, allowing for more production.

The January sub-index for the manufacturing sector, which accounts for more than 90 percent of Taiwan's total industrial production, rose 10.84 percent from a year earlier to 117.45.

The year-on-year growth in overall industrial production in January was a high since January 2013, when the increase hit 19.06 percent, while the January growth in the manufacturing sector reached its highest level since February 2017, when the increase stood at 14.24 percent, the MOEA said.

Taiwan's industrial production in January extended its momentum from 2017, when industrial production grew 2.9 percent year-on-year, with production in the manufacturing sector up 3.74 percent.

Both the overall growth rate and the growth in the manufacturing sector for 2017 were three-year highs.

In the manufacturing sector, production in the electronic component industry grew 10.28 percent from a year earlier in January on the back of an increase in smart technology applications, with production among semiconductor firms up 9.95 percent year-on-year, the MOEA said.

Production in the PC and optoelectronics sector also grew 12.74 percent in January on the back of a relatively low comparison base over the same period of last year as well as solid demand for camera lenses, the MOEA said.

The MOEA added that production in the chemical material industry for January grew 1.32 percent from a year earlier in reflection of high international crude oil prices as well as moves by clients to rebuild inventories, but some major petrochemical firms had output cuts because of annual maintenance work, which compromised the performance of the entire industry, the MOEA said.

The machinery industry saw production rise 22.94 percent from a year earlier in January as demand for automation remained on the rise, while production of the auto and auto part industry also grew 17.25 percent on rush demand from North America, which was hit by severe snowstorms, the MOEA added.

Wang Shu-chuan (???), deputy head of the MOEA's statistics department, told the press that the presence of emerging applications, such as artificial intelligence and application-specific integrated circuits used in crypto-currency trading, is expected to offset the impact from slow season effects in the semiconductor business in the first quarter.

The six-day Lunar Year holiday in February affecting industrial production could drag down the index in the month, but momentum could pick up in March, Wang said.

Source: Focus Taiwan News Channel