China’s warehousing index in October was 49.8%

The China Federation of Logistics and Purchasing released the China Warehousing Index for October today. The index has recovered slightly from its low point, but it is still in the contraction range for three consecutive months, and the demand foundation still needs to be consolidated.

In October, China's warehousing index was 49.8%, an increase of 0.1 percentage points from the previous month, and the prosperity level continued to hover near the boom-bust line.

In terms of business scale, the business volume index has declined. In October, the business volume index was 50.0%, a decrease of 2.8 percentage points from the previous month, falling back to the boom-bust line. The recovery of consumption and bulk commodities has been slow. The overall manufacturing market demand has slowed down in October. The construction industry has started slowly, which has restricted the bulk commodity warehousing business. The business volume index of steel, non-ferrous metals, building materials and other categories are all below 50%. The service industry performed relatively stably driven by holiday consumption, but its boost to the consumer goods warehousing business was relatively limited.

From the perspective of inventory turnover, inventory continues to decline and turnover efficiency has slowed down. In October, the ending inventory index was 49.0%, the same as last month, running in the contraction range for five consecutive months; the average inventory turnover index was 48.0%, down 1.5 percentage points from the previous month, and running in the contraction range for three consecutive months. Demand recovery is less than expected, companies are mainly focusing on digesting existing inventories, and the destocking cycle has not yet ended.

Judging from order expectations, new orders continue to expand, and demand recovery is expected in the future. In October, the new order index was 50.9%, running in the expansion range for two consecutive months, showing that the new demand for warehousing business remained stable overall, but the conversion into actual business volume was insufficient. The business activity expectation index was 56.9%, an increase of 0.9 percentage points from the previous month, and continued to rise in the expansion range, indicating that companies have good expectations for the market outlook.

Liu Yuhang, chief engineer of the China Federation of Logistics and Purchasing, said that in November, economic stabilization policies will continue to exert force, special bonds and other funds will accelerate the formation of physical workload, e-commerce promotions and the year-end consumption peak season will drive a phased recovery in the demand for consumer goods, and the demand for warehousing business is expected to gradually improve. Taken together, the operation of the warehousing industry in the later period has the basis for stabilization and recovery.

(CCTV reporters Cong Weina and Chen Xi)