Singapore’s Manufacturing Output Beats Forecasts with August Jump

Singapore’s manufacturing production jumped by 13.7 percent year over year in August 2020, beating market expectations thanks to strong performance in electronics output.

Manufacturing output also rose by 13.9 percent in August from July, the Singapore Economic Development Board said on 25 September.

Electronics output increased by 44.2 percent in August 2020 compared to a year earlier, mostly driven by the semiconductors segment where production jumped by 56.9 percent, supported by demand from cloud services, data centres, and the 5G market. Overall, the output of the electronics cluster in Singapore increased by 4.1 percent year over year between January and August 2020.

Manufacturing output in the Precision Engineering cluster grew by 9.4 percent in August 2020 compared to the same month last year, thanks to machinery & systems production, which increased by 17.0 percent on the back of higher production of semiconductor equipment, according to the Singapore Economic Development Board.

Biomedical manufacturing output rose by 8.4 percent year-on-year in August 2020, while year to date, Singapore’s biomedical manufacturing production increased by 18.0 percent compared to the first eight months of 2019.

Chemical output grew by 3.1 percent year-on-year in August 2020, driven by the specialties and petrochemicals segments where production rose by 8.9 percent and 7.8 percent, respectively, the data showed.

“A very stellar performance was seen in August when manufacturing output rose 13.7% yoy (13.9% mom sa),” Selena Lin, Head of Research and Strategy at OCBC Bank, said, commenting on the data.

“This exceeded both market and our expectations, and was aided by an electronics outperformance,” Lin noted.

“Our sense is that the uptick in the global electronics demand will likely sustain in the coming months as this improvement trend is apparent across other key regional manufacturing hubs including Taiwan and South Korea. As such, we have pencilled in a healthy electronics output growth for the remaining four months of 2020, which may lift our full-year 2020 manufacturing growth forecast from 2.5% to 3.5% yoy,” Lin said.