Estonian industrial production returns to growth in May

Estonian industrial production returns to growth in May
By bne IntelliNews July 2, 2019

Estonian industrial production grew 1.2% y/y in May, working-day adjusted data from Statistics Estonia showed on July 2. The expansion follows a fall of 0.4% y/y recorded in Estonian industry the preceding month.

The reading marks a return to expansion in Estonia’s industrial output after April’s dent ended a 33-month series of uninterrupted growth, helping the economy. Estonian GDP growth beat expectations in January-March, expanding 4.5% y/y in unadjusted terms (4.6% y/y upon adjustment) on the back of surging investment.

GDP growth is expected to come in at below 3% in 2019 although the first quarter data appear to make that prediction overly pessimistic. The Baltic state’s GDP growth came in at a solid 3.9% in 2018.

Broken down by main segments, manufacturing output expanded a working day adjusted 5% y/y in May, data showed. 

Production in mining dropped 19.6% y/y and output in the energy sector fell even more, at 25.2% in annual terms. Production of electricity crashed 34% y/y while output in the heat segment grew 21% in annual terms.

Within the manufacturing sector, all but three segments increased production. The fastest expansion took place in the manufacturing of computers, electronic, and optical products, at 27.1% y/y.

The largest fall beset production of chemical products, where output fell 16% on the year.

In unadjusted annual terms, industrial production also expanded 1.2% in May. In seasonally adjusted monthly terms, output inched up 0.3%.

Some 68% of industrial output was sold on the external market, Statistics Estonia also reported. According to unadjusted data, export sales of manufacturing production grew 9% in y/y terms in May while domestic sales remained flat y/y.