November 2022: Small and Medium sized Enterprises (SMEs) not taken into account
The European Foundry Industry Sentiment Indicator (FISI) moves sideways in November. A minor improvement by 0.2 points brings the index to a value of 103.0 points. While business expectations for the next six months have declined again, assessments of the current business situation surprisingly increased in November. Overall, both factors equalise each other in the calculation of the FISI.
The extreme peaks in energy prices have not been noted recently. Nevertheless, due to the still very high cost level in many countries, governments are working on measures to reduce the burden. These so-called emergency measures are regulated within the EU by the Temporary Crisis Framework as part of state aid law. On the one hand, complex and insufficient relief packages are already emerging from this; on the other hand, the crisis shows that a strategic and practical industrial policy is still only being discussed inadequately. While the Inflation Reduction Act has been introduced in the USA just last month, the EU is still concerned with negotiating on the Carbon Border Adjustment Mechanism (CBAM). This again might just become another case of “well meant and badly done” particularly bringing detrimental prospects to small and medium-sized foundries who are already under significant cost pressure.
Meanwhile the Business Climate Indicator (BCI) decreased in November. The decrease of 0.20 points brings the index to 0.54 points. The production trend observed in recent months as well as the assessment of (export) order-book levels significantly decreased.
The FISI – European Foundry Industry Sentiment Indicator – is the earliest available composite indicator providing information on the European foundry industry performance. It is published by CAEF the European Foundry Association every month and is based on survey responses of the European foundry industry. The CAEF members are asked to give their assessment of the current business situation in the foundry sector and their expectations for the next six months.
The BCI – Business Climate Indicator – is an indicator published by the European Commission. The BCI evaluates development conditions of the manufacturing sector in the euro area every month and uses five balances of opinion from industry survey: production trends, order books, export order books, stocks and production expectations.
Tillman van de Sand
Secretary Commission for Economics & Statistics
phone: +49 211 68 71 — 301