ICI Released December 2024 Türkiye Manufacturing PMI and Türkiye Sector PMI Report

• 01.01.2025
• News

The Istanbul Chamber of Industry Türkiye Manufacturing PMI rose to 49.1 in December, pointing to only a slight moderation in the health of the manufacturing sector and one that was the least pronounced in eight months. The move towards stabilisation in overall business conditions in the sector was consistent with the picture across a range of variables in the latest survey. 

According to the December Istanbul Chamber of Industry Türkiye Sectoral PMI report, nine of the 10 sectors slowed down their output in November. This number was seven in December, thus indicated a relative improvement. The sharpest decline in output was in clothing and leather products sector, while growth was seen only in chemical, plastic and rubber products and food products sectors. The upward trend in the output of the food sector reached the third month. 

Istanbul Chamber of Industry (ICI) released the results of the December 2024 Türkiye Manufacturing PMI (Purchasing Managers’ Index) survey, which is the fastest and reliable reference accepted in manufacturing industry performance of the economic growth. According to the survey results, where any figure greater than 50.0 indicates overall improvement of the sector, the headline PMI rose to 49.1 in December from 48.3 in November, pointing to only a slight moderation in the health of the manufacturing sector and one that was the least pronounced in eight months. The move towards stabilisation in overall business conditions in the sector was consistent with the picture across a range of variables in the latest survey. Production was scaled back only marginally and to the least extent in the current nine-month sequence of slower output, amid some signs of demand improving. New orders continued to moderate overall, however, as demand remained subdued. Although still solid, the latest easing of new business was the least marked since last April. Similarly, new export orders also moderated to a lesser extent at the end of the year.

With new order inflows remaining muted, manufacturers scaled back their purchasing activity, inventory holdings and employment, the last of which easing following a rise in November. In all cases, however, rates of slowdown were only marginal. Input costs increased at a marked pace in December, linked to higher raw material prices and weakness of the lira against the US dollar. The pace of inflation was a three-month high but much weaker than the average for 2024 as a whole. 

Meanwhile, the pace of output price inflation was only slight, having eased to the weakest in just over five years. While some firms increased charges in response to higher raw material costs, others offered discounts to customers as part of efforts to secure sales.

Commenting on the Istanbul Chamber of Industry Türkiye Manufacturing PMI survey data, Andrew Harker, Economics Director at S&P Global Market Intelligence, said: 

“The final set of PMI data for Türkiye in 2024 provided plenty of hope for the sector in 2025. While business conditions continued to moderate, the latest slowdown was only marginal as signs of improvement were seen in a range of variables across the survey. If this momentum can be built on at the start of 2025, we could see the sector return to growth. The prospects for the sector should be helped by a much more benign inflationary environment than has been the case in recent years. Output prices rose only slightly in December, and to the least extent in just over five years.”

Output and new orders slowed broadly in December according to sector PMI

According to the December Istanbul Chamber of Industry Türkiye Sectoral PMI report, nine of the 10 sectors monitored under the survey slowed down their output in November. This number was seven in December, thus indicated a relative improvement. The sharpest decline in output was in clothing and leather products sector, while growth was seen only in chemical, plastic and rubber products and food products sectors. The upward trend in the output of the food sector reached the third month. No change was observed in electrical and electronic products compared to the previous month.

As in output, increases in new orders were limited to the chemical, plastic and rubber products and food products sectors. Contraction was recorded in other sectors, especially in the basic metal industry. New export orders also slowed down in seven of the 10 categories. The volume of employment increased in food manufacturers and machinery and metal products firms, but declined in other sectors. The most significant decline in the number of employees was recorded in the clothing and leather products sector. A similar picture was observed in purchasing activity. Input purchases increased only in the chemical, plastic and rubber products and food sectors.

Signs of easing inflationary pressures strengthened in December. The rise in input costs in most sectors lost pace compared to November. The fastest increase in input prices was realized in non-metallic mineral products, while the slowest increase was realized in basic metals. Inflation in the basic metal sector was measured at the lowest level in more than five years. Due to the decline in cost inflation and the stagnation in demand, textile, clothing-leather and basic metal sectors reduced their selling prices. Thus, the number of sectors among the 10 sectors with lower selling prices increased to three in December from two in November. On the other hand, the most significant increase in product prices was observed in the machinery and metal products sector, where inflation reached its highest level since March.

You can find attached the Istanbul Chamber of Industry Türkiye Manufacturing PMI and Sector PMI December 2024 reports.