Strengthened Australian Dollar hit the manufacturing industry
Published By : 01 Jul 2014 | Published By : QYRESEARCH
As the Australian dollar strengthened and increased import competition and demand for locally-made products, the manufacturing industry is still struggling to its roots.
The Australian Industry Group (Ai Group) said on Tuesday, that the Australian manufacturing has been facing a decline for consecutive eight months at a stretch.
The current rise of the Australian dollar, sitting above 94 US cents, caused more pain, with softening sales of locally-made products.
The performance activities in themanufacturingindex dropped 0.3 points in June to 48.9 points - below the 50 level, separating contraction from expansion.
The Australian Industry Group chief executive Innes Willox said the month of June witnessed some positive signs with a lift in food and beverage exports, and added that removing the carbon tax would help in manufacturing.
Many respondents from the import-competing businesses noted the adverse effects of the strengthened Australian dollar, added MrWillox.
The manufacturing sector will face many pressures and there will be a constant need to improve cost-competitiveness and productivity across the industry.
This also highlights the fact to remove the carbon tax and help the manufacturers, especially with competitive pressures forced many to absorb the cost of the tax.
The only sub-sectors that were likely to experience an expansion were food and beverages, as well as wood and paper products. On the other hand, the metal, machinery and equipment, and petroleum, coal, chemicals and rubber sub-sectors all contracted.