The food, beverage, and tobacco industry saw moderate-to-strong growth last month, according to the most recent Manufacturing ISM Report on Business. The March Manufacturing PMI was 57.1%, a 1.5 percentage-point decrease from February’s rate of 58.6% (anything over 50% indicates growth). While the overall PMI was its lowest since September 2020 (55.4%), March was still the 22nd consecutive month of growth.
Workforce issues, including turnover and difficulty backfilling positions, remain a struggle, but the situation has improved since February. Meanwhile, the price index soared to 87.1, an 11.5% increase from February. Food oils are in short supply for the second month in a row, due to the Russian invasion of Ukraine.
According to one industry respondent, “Overall business conditions are challenging in both domestic and international transportation. The Russian invasion of Ukraine has created uncertainty in the grain markets, causing upward pricing pressure. In addition, inflationary pressures across all categories have made it challenging to manage cost and profitability.”