The cement sector recorded the highest growth in economic activities for September 2024, as Nigeria’s Purchasing Managers’ Index (PMI) expanded to 50.5 points, according to the latest report from the Central Bank of Nigeria (CBN).
This marks an improvement from the 50.2 points recorded in August 2024, indicating a continued expansion in economic activities for the second consecutive month.
The PMI survey, conducted from September 9-13, 2024 by the CBN, provides insight into the direction of business activities across key sectors of the Nigerian economy, including industry, services, and agriculture. The index is derived from the responses of purchasing and supply executives from various companies, who provided data on their business activities. An index above 50.0 points suggests growth in business activities, while an index below 50.0 points signals contraction. A reading of 50.0 points indicates no change.
In the September 2024 report, the services and agriculture sectors both registered expansions, with the services sector showing growth for the fourth consecutive month. While the industrial sector experienced a contraction, the pace of decline was slower compared to August 2024. The cement sub-sector stood out among the 36 subsectors reviewed across the three sectors, recording the highest growth in economic activities, while 10 subsectors, including transportation and warehousing, reported declines.
Output levels, new orders, and stock of raw materials showed positive trends, with readings of 50.7, 52.2, and 51.4 points, respectively, signifying growth. However, there were some areas of decline—particularly in suppliers’ delivery time and employment, which stood at 48.4 and 49.1 points respectively, indicating a contraction in these areas during September.
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In terms of production, the composite output index rose to 50.7 points, marking the third consecutive month of growth. Of the 36 sub-sectors reviewed, 21 showed growth in production levels, with the management of companies subsector recording the highest expansion. Conversely, subsectors such as forestry and transportation & warehousing experienced declines. Five sub-sectors remained unchanged during the review period.
New orders increased during the month, as indicated by the 52.2 points recorded in September. Nineteen subsectors, including chemical and pharmaceutical products, saw growth in new business orders, while 14 sub-sectors reported declines in incoming orders. Some subsectors, such as furniture and related products and motion pictures, Cinema, sound recording and music production, showed no change.
Employment levels, however, contracted for the month. The composite employment index stood at 49.1 points, showing that although employment levels were still declining, the contraction was less severe than in August 2024. Sixteen sub-sectors experienced job losses, with the paper products subsector being hit the hardest. On the other hand, the forestry subsector recorded the highest employment index, as 18 sub-sectors reported growth in employment levels.
The industrial sector remained in a state of contraction, with a PMI of 49.7 points in September. Despite this, the pace of contraction was slower than in previous months, suggesting a gradual rebound. Mining, quarrying, electricity, gas, water supply, and construction sub-sectors saw expansion while manufacturing subsectors continued to decline. Among the 17 subsectors surveyed, four recorded contractions, three remained unchanged, and 10 showed expansions, with cement leading in terms of growth.
The industry’s stock of output and raw materials rose to 50.7 and 51.7 points, respectively, indicating increased production levels. However, the new orders and employment indices showed a slight decline at 49.9 and 48.2 points, while suppliers’ delivery times were slower at 48.4 points in September.
Overall, the report reflects a mixed performance across various sectors, with the cement subsector serving as a key driver of growth. The report highlights how the cement industry, alongside certain industrial and service sectors, continues to play a crucial role in sustaining economic expansion amid ongoing challenges across other subsectors.
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