CSS Monthly Shipments: First Signs of Inventory Liquidation in June

Stats Fact of the Week

NFPA’s June 2019 Confidential Shipment Statistics (CSS) report, a monthly source of fluid power shipment and order data trends often used to benchmark company performance, displayed the first signs of inventory liquidation in the U.S. fluid power marketplace. A declining orders trend combined with numerous order cancellations resulted in large negative trend analysis indicators, year-to-year percent change, and month-to-month percent change, which supports concerns of distributors and customers exhausting existing inventories before placing any new orders. If traditional trends hold true, we will see further weakening of equipment and product shipments.

Preliminary June 2019 shipments of fluid power products decreased 8.6% compared to June 2018 and decreased 3.7% when compared to May 2019. Mobile hydraulic, industrial hydraulic, and pneumatic shipments decreased when compared to last year. Mobile hydraulic and pneumatic shipments decreased, while industrial hydraulic shipments slightly increased when compared to last month.

Final May 2019 shipments of fluid power products decreased 0.5% for the 2019 calendar year when compared to the same time period in 2018. The 12-Month Moving Average (MMA) index of 99.8, an indicator of change in the size of the industry, dipped below 100 for the first time in 2019, while the 12/12 Ratio index of 104.6, an indicator of change in the rate of growth in the industry, maintained its level above 100. The direction and speed in which these two index indicators move, as well as their position above or below 100, can help you understand the short-term outlook for our industry.

Continuing to keep a close eye on leading indicators and industry/product pricing trends will help companies navigate how far the industry will decline and at what pace. The current pace of decline is speeding up and will require your full attention to stay on top of it.

The Confidential Shipments Statistics (CSS) Program
The only monthly source of aggregated industry data for the U.S. fluid power industry. This report presents data on monthly shipments and orders collected from our membership and helps users understand trends and anticipate change within the industry. Member companies can benchmark their own company’s performance against overall industry performance using the CSS results. Data is collected from participating U.S. fluid power manufacturers, compiled by a 3rd party to maintain confidentiality, and results are then only sent to CSS participants.

Questions and inquiries about participating in the Confidential Shipment Statistics (CSS) program can be directed to Eric Armstrong at earmstrong@nfpa.com or (414) 778-3372.