The industrial production index rose 22.6 percent year-on-year to 120.18 last month, driven by strong demand for artificial intelligence (AI) servers and related applications, as well as continued front-loading of shipments in anticipation of potential US tariffs, the Ministry of Economic Affairs reported yesterday.
The manufacturing production index, which comprises 94.63 percent of the industrial production index, increased 24 percent year-on-year to 121.41, marking the 15th consecutive month of growth and surpassing the ministry’s forecast range of 108.67 to 112.67.
In the first five months of this year, the industrial and manufacturing production indices grew by 16.39 and 17.43 percent year-on-year respectively, Department of Statistics Deputy Director-General Huang Wei-jie (黃偉傑) told a news conference in Taipei.
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The manufacturing production index this month is expected to rise between 23.6 and 27.8 percent annually, the ministry said.
That could push the industrial production index for the first half of the year to between 106.96 and 107.63, a year-on-year increase of 18.5 to 19.2 percent — the highest growth for the same period since 2010, Huang said.
“Before the tariff rate is finalized, there will be a front-loading effect, but it will gradually taper off, as manufacturers cannot continue to front-load indefinitely,” he said.
“The recent growth momentum in the indices is mainly driven by the AI sector,” he said.
Production of electronic components rose 34.53 percent year-on-year as demand for high-performance computing (HPC) and AI applications remained strong, the ministry said.
The sub-index for semiconductor production surged 38.1 percent, driven by continued strong demand for AI and HPC devices, which boosted demand for 12-inch wafers.
Meanwhile, the sub-index for flat panel and related component production rose 5.09 percent, ending a decline that had persisted since April, it said
“As front-loading shipments of large TV panels ended in the first quarter, it might now be the turn for medium and small panels, which are mainly used in industrial, automotive and medical applications,” Huang said.
Production of computers, electronic goods and optical components surged 89.28 percent year-on-year, driven by strong demand for AI applications and cloud data services, while ongoing investment in the semiconductor industry also boosted output of servers and information technology products, the ministry said.
In contrast, production of base metals, primarily steel, fell 6.3 percent annually, attributed to manufacturers suspending operations for maintenance and repair of production equipment since April, with some manufacturers indicating that repairs would take more than a month, Huang said.
Machinery equipment production rose 6.21 percent year-on-year, driven by demand for semiconductor production equipment, such as chip packaging and testing, as some manufacturers continue to expand their plants, he said.
However, production of chemical materials and fertilizers fell 8.51 percent, mainly due to price competition from Chinese rivals and weak market demand, he added.
Car product output declined 16.31 percent, as some production lines were temporarily shut down for maintenance, which reduced output of small sedans and trucks, he said.
The front-loading momentum for car components also slowed compared with the previous month, he added.
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