Manufacturing fell short of government forcasts in the third quarter of this year, contracting for the seventh consecutive quarter due to worldwide crude oil and LCD panel price declines.
Production value declined by 1.6 percent annually to NT$3.11 trillion (US$97.16 billion) last quarter, Ministry of Economic Affairs data showed.
The ministry said production value for this quarter would grow from a year earlier on Apple Inc’s iPhone 7 launch.
“The value decline in the petrochemical and panel sectors offset the growth in the semiconductor sector,” Department of Statistics deputy director-general Wang Shu-chuan (王淑娟) said by telephone.
Wang said although the prices of oil and flat panels have been improving, they still represented an about 10 percent decline from a year earlier, which dragged down overall production value of local manufacturers.
Scheduled annual examinations and maintenance at a number of petrochemical plants also suppressed production value last quarter, she said.
The petrochemicals segment, which accounted for 12.35 percent of total manufacturing production, dropped 3.54 percent annually to NT$384.6 billion last quarter, while the flat panel segment contributed 6.67 percent of production value, falling 9.84 percent to NT$207.6 billion from a year earlier, ministry data showed.
Wang said despite the result, the 1.6 percent annual decline was the smallest contraction in the past seven quarters, supported by the semiconductor sector’s 21.87 percent annual growth on the back of the iPhone 7 launch.
The semiconductor sector accounted for 11.25 percent of manufacturing, the ministry data showed.
Wang said the ministry forecast that declines could end this month driven by the semiconductor sector.
Continued improvement in the average selling price of flat panels could lend support to the overall output this quarter, she said.
A relatively lower NT$3.08 trillion base in total manufacturing output during the fourth quarter of last year would increase the chances of expansion this quarter, she added.
However, oil prices remain unpredictable, Wang said, adding that the recent depreciation of New Taiwan dollar against the US dollar would increase import costs for the petrochemical sector.
She declined to offer annual growth forecasts for this quarter’s manufacturing.
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