Industrial production in Taiwan last month expanded by a better-than-expected 10 percent year-on-year, thanks to easing component shortages and continued capacity expansion by semiconductor companies in response to robust demand, the Ministry of Economic Affairs said yesterday.
The industrial production index last month climbed for a 25 consecutive month to 117.49, the highest figure for February on record following the second-longest upcycle, the ministry said.
The manufacturing production index, a major contributor to the nation's industrial production, jumped 10.16 percent last month to 119.76, hitting the best February level. That beat the ministry’s estimate of a decline of between 2.9 percent and 5.7 percent on an annual basis, citing seasonal factors.
Photo: Ritchie B. Tongo, EPA-EFE
The growth momentum is expected to extend into this month, with the manufacturing production index to rise between 3.4 percent and 6.2 percent year-over-year, indicating that the manufacturing sector is to see its best March performance ever, Department of Statistics Deputy Director-General Huang Wei-jie (黃偉傑) said by telephone yesterday.
“The first quarter is usually a slow season, but seasonal weakness has barely been felt by local manufacturers this year,” Huang said. “It is likely that the first quarter might be the strongest, only coming after last year’s third and fourth quarters.”
Huang attributed last month’s stronger-than-expected manufacturing output to robust demand for electronic components.
“The electronic component segment had better performance than we expected. The segment contributed about 90 percent to manufacturing output,” Huang said.
Foundry companies, chip testing and packaging service providers, and substrate suppliers are expanding capacity as fast as they can to meet robust demand for chips used in high-performance computing, smartphones, vehicles and the Internet of Things, Huang said.
The production of electronic components last month increased 17.14 percent annually, the 27th consecutive month of growth, while production of semiconductors rose 20.1 percent, and production of LCD panels and other components rose 13.16 percent, ministry data showed.
“Robust growth in the electronic component segment helped offset declines in some traditional sectors,” Huang said.
Production of petrochemicals fell 3.29 percent, as demand for COVID-19 personal protective equipment declined as the number of infections stabilized.
Petrochemical suppliers have also shut down some factories for regular maintenance, which has cut production.
The production of computers and other electronics increased 9.55 percent, as easing component shortages helped boost output.
Demand for data centers, networking equipment and better solid-state drives drove output, the ministry said.
However, the growth was diminished by a decrease in the production of smartphone camera lenses, it said.
The production of basic metals dipped 1.94 percent, as local steelmakers shut down some furnaces for maintenance and due to a higher comparison base last year, the ministry said.
Output in the machinery segment increased 11.44 percent, mainly driven by expansion at local semiconductor companies, 5G infrastructure projects and demand for automation equipment.
The production of vehicles and automotive components fell 1.41 percent due to global port congestion and a global chip shortage, the ministry said.
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