Strong Decmeber Shipments Slow 2013 Downtrend in Taiwan's Machienry Exports

In December 2013 alone, Taiwan's machinery shipments surged 18.9% from the same month of 2012, to US$1.88 billion, bringing total shipments of the Taiwan industry for 2013 to US$19.7 billion to beat originally projected contraction rate of 2-3% year on year with a slower downtrend of 1.6%.

The Taiwan Association of Machinery Industry (TAMI), which represents over 2,600 machinery makers on the island, ascribes the brisk monthly export growth mostly to US$200 million of rush orders to be shipped by yearend.

Unlike the island's general machinery exports, its machine-tool sector throughout 2013 saw exports plunge 16% year on year, to US$3.6 billion or so. But many machine-tool makers have seen orders obviously increase beginning this year from the past few months, expecting surging export orders  in the second quarter to push up shipments for 2014 to the 2012 level of US$4.2 billion.

Major machine-tool makers on the island, including Victor Taichung Machinery Works Co., Ltd., Tongtai Machine & Tool Co., Ltd., Yoeng Chin Machinery Industries Co., Ltd., Awea Mechantronic Co., Ltd., Goodway Machine Corp., and Kao Fong Machinery Co., Ltd., began late 2012 or early 2013 migrating to high-end machines for automobile and automation industries away from universal  machines that rely on underselling competition.

As for 2014, Taiwan's machinery exports are estimated to rise 5-8% to at least US$21 billion, with production revenue likely to reach NT$1 trillion (US$33.3 billion), according to the association, which bases the optimistic forecast on projected 2014 recovery in major economies, with the United States estimated to grow 2.5% from 2013's 1.8%, China projected to surge 8.1% from the previous year's 7.7%, and Germany anticipated to climb 1.8% from 0.6%. In Taiwan, the economy is anticipated to expand 2.6%, up from 2013's 1.7%.

The association estimates the island's shipments of general machines to China to turn around to grow this year from a 1.7% contraction last year. To America, the shipments are projected to rise 5-10% year on year this year from last year's 1% increase thanks to the Obama administration's promotion to attract home overseas American industries. To the Association of Southeast Asian Nations (ASEAN) market, Taiwan exports are estimated to rise 5-10% year on year. (KL)