2006 boost: Industrial controls, packaging machinery markets grow


Rosslyn and Arlington, VA —Positive 2006 U.S. manufacturing indicators could lend hope to early 2007 if trends continue in industrial controls and in one of its major beneficiaries, packaging machinery. Segments of the manufacturing sector, including the electroindustry, continue to perform well. The good news came from National Electrical Manufacturers Association 's (NEMA) and the Packaging Machinery Manufacturers Institute (PMMI).

The nearly 8% jump in the NEMA Primary Industrial Controls Index between the third and fourth quarters of 2006, was the largest quarter-to-quarter increase since 1992. On a year-over-year basis, the index rose 3%, NEMA noted. By comparison, the Primary Industrial Controls and Adjustable Speed Drives index, a broader measure of demand for industrial controls, increased 5.6% during the fourth quarter of 2006. In addition, the index posted its thirteenth consecutive quarter of year-over-year growth, recording a 4% gain versus the fourth quarter of 2005.

Machinery design and capabilities continue to advance , helping shorten time to market for packaging machines and their products. The global demand for U.S. packaging machinery also continues to rise, reflecting a positive impact on the economy. The most recent U.S. Census data, reported by PMMI, indicates a strong close of the year for U.S. packaging machinery shipments. PMMI credits machinery manufacturers' innovation, value-added services for growth. From January to November of 2006, U.S. exports of packaging machinery increased 7% compared to the same period of 2005 totaling U.S. $783 million. U.S. imports of packaging machinery increased 6%. The data, based on U.S. Census estimates and reported by PMMI, reflect the overall economic impact of the U.S. packaging industry.

NEMA says U.S. economic growth accelerated during the fourth quarter of 2006, as real GDP increased at a stronger-than-expected 3.5% annualized rate. Although the housing market continued to weigh on economic growth, other factors, namely consumer spending and export demand, saw healthy gains to close out the year. Recent industrial sector indicators have been mixed, but still point to some firming in manufacturing activity at least during the first half of 2007. For example, the January reading for the ISM index dipped, showing the manufacturing sector contracted for the second time in three months. However, an inventory correction cycle explains the sector's recent weakness to some degree, as production of manufactured goods has tapered off as businesses sell off stockpiles. Once this inventory cycle works itself out, manufacturing activity is expected to regain some momentum.

A 13% surge in industrial production of core electrical equipment including industrial controls was tallied between December 2005 and 2006, even though NEMA's Electroindustry Business Confidence Index shows the electroindustry currently slumping a bit from its recent strong performance. In addition, the capacity utilization rate within the broader electrical equipment manufacturing sector came in at 85% during fourth-quarter 2006. Though down from its peak from earlier in the year, the electroindustry's capacity utilization rate remains well above its historical average of 82%. Both indicators likely suggest that demand for industrial controls and adjustable speed drives should remain at a relatively high level over the near term, NEMA says.

' November numbers indicate a solid international demand for U.S. packaging machinery,' said Charles D. Yuska, president and CEO, PMMI. 'PMMI member companies are aware of brand owners needs. In addition to introducing new and advanced machinery, they also provide solutions and services that help brand owners gain a competitive edge in the marketplace and boost overall operational efficiency.'

End-users continued to replace older packaging machines with new models featuring state-of-the-art technology and promising rapid return on investment. According to PMMI's '12th Annual Shipments and Outlook Study,' released in September 2006, growth in U.S. packaging machinery shipments can be attributed to end-users expanding production lines to accommodating new product introductions and package designs. 'PMMI is optimistic that the industry will continue to experience solid growth in 2007 based on the consistent rise of 2006 Census numbers and positive sales cycle projections,' noted Yuska. 'In addition, we experienced record-breaking attendance at Pack Expo International in October 2006. The show continuously exemplifies its strong impact on the packaging industry, bringing together the international packaging community all under one roof.'

The Industrial Control Business Indices are issued quarterly by NEMA. The Primary Industrial Control Index represents U.S. shipments for motor starters, contactors, terminal blocks, control circuit devices, motor control centers, sensors, programmable controllers, and other industrial control devices.

More numbers are available from NEMA and PMMI; the organizations made the announcements independently on Feb. 2.

—Control Engineering Daily News Desk
Edited by Mark T. Hoske , editor in chief

No comments
The Engineers' Choice Awards highlight some of the best new control, instrumentation and automation products as chosen by...
The System Integrator Giants program lists the top 100 system integrators among companies listed in CFE Media's Global System Integrator Database.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
This eGuide illustrates solutions, applications and benefits of machine vision systems.
Learn how to increase device reliability in harsh environments and decrease unplanned system downtime.
This eGuide contains a series of articles and videos that considers theoretical and practical; immediate needs and a look into the future.
Make Big Data and Industrial Internet of Things work for you, 2017 Engineers' Choice Finalists, Avoid control design pitfalls, Managing IIoT processes
Engineering Leaders Under 40; System integration improving packaging operation; Process sensing; PID velocity; Cybersecurity and functional safety
Mobile HMI; PID tuning tips; Mechatronics; Intelligent project management; Cybersecurity in Russia; Engineering education; Road to IANA
This article collection contains several articles on the Industrial Internet of Things (IIoT) and how it is transforming manufacturing.

Find and connect with the most suitable service provider for your unique application. Start searching the Global System Integrator Database Now!

SCADA at the junction, Managing risk through maintenance, Moving at the speed of data
Flexible offshore fire protection; Big Data's impact on operations; Bridging the skills gap; Identifying security risks
The digital oilfield: Utilizing Big Data can yield big savings; Virtualization a real solution; Tracking SIS performance
click me