European Foundry Industry Sentiment

July 2021: Sum­mer slump or signs of a setback?

In July the European Foundry Sen­ti­ment Indic­ator (FISI) dropped for the first time since exactly one year. The decrease of 0.8 points brings the index to a value of 108.7. Both the cur­rent situ­ation and the expect­a­tions for the next six months are assessed slightly worse by the European foundries than in the pre­vi­ous month. This devel­op­ment does not yet rep­res­ent a clear set­back. Nev­er­the­less, in par­tic­u­lar the high raw mater­ial prices and the still tense situ­ation in logist­ics as well as the prob­lems in the vehicle con­struc­tion industry are impact­ing the sen­ti­ment among European foundries.

Mean­while, the slight dampener impress­ively shows that a fur­ther recov­ery is fra­gile even with a good order situ­ation. It remains to be seen whether this is only an inter­rup­tion in the upswing or if the recov­ery will lose momentum in the com­ing months. The more the catch-up effects of the crisis are over­come, the greater will the mul­tiple chal­lenges of indus­trial trans­form­a­tion also be felt by the foundries.

At the same time, the Busi­ness Cli­mate Indic­ator (BCI) con­tin­ues its record reach­ing improve­ment in July. The increase of 0.20 points raises the index to its record level of 1.90 points. The cur­rent busi­ness situ­ation is assessed as over­all pos­it­ive due to the excel­lent order-book levels from EU and non-EU coun­tries. There­fore, the para­meter for employ­ment expect­a­tions is reach­ing its highest level since the begin­ning of the records in 1985, just like in Decem­ber 2017.

The FISI – European Foundry Industry Sen­ti­ment Indic­ator – is the earli­est avail­able com­pos­ite indic­ator provid­ing inform­a­tion on the European foundry industry per­form­ance. It is pub­lished by the European Foundry Asso­ci­ation (CAEF) every month and is based on sur­vey responses of the European foundry industry. The CAEF mem­bers are asked to give their assess­ment of the cur­rent busi­ness situ­ation in the foundry sec­tor and their expect­a­tions for the next six months.

The BCI – Busi­ness Cli­mate Indic­ator – is an indic­ator pub­lished by the European Com­mis­sion. The BCI eval­u­ates devel­op­ment con­di­tions of the man­u­fac­tur­ing sec­tor in the euro area every month and uses five bal­ances of opin­ion from industry sur­vey: pro­duc­tion trends, order books, export order books, stocks and pro­duc­tion expectations.

CAEF Con­tact:

Till­man van de Sand
Sec­ret­ary Com­mis­sion for Eco­nom­ics & Stat­ist­ics
phone: +49 211 68 71 — 301
mail: tillman.vandesand@caef.eu