Manufacturing activity in Oklahoma and other states has seen a slight decline according to a new economic report.
Those states that make up the Tenth District of the Federal Reserve Bank of Kansas City experienced the drop according to the February Manufacturing Survey released by the Bank.
“Regional factory activity continued to fall in February,” said MeganWilliams, associate economist and survey manager.
“Firms decreased employment levels moderately this month but expect overall activity and employment to increase in the next six months.”
The Federal Reserve Bank of Kansas City serves the Tenth Federal Reserve District, encompassing the western third of Missouri; all of Kansas, Colorado, Nebraska, Oklahoma and Wyoming; and the northern half of New Mexico.
The survey found prices paid for raw materials increased substantially this month and continued to outpace growth in finished product prices, further constraining profit margins.
This month contacts were asked special questions about trade policy and passthrough ability. 43% of firms believe recent trade policy changes will not change their demand or revenues, while approximately a quarter each believe demand will be lower (26%) and higher (23%).
Another 7% of firms believe trade policy changes will lower demand significantly while 1% believe it will increase demand significantly. Contacts were also asked about their ability to pass through higher costs to their customers. 39% of firms reported passing through 0-20% to their customers, 6% reported passing through 20-40%, 12% reported 40-60%, 11% reported 60-80%, 23% reported 80-100%, 2% reported more than 100%, and 7% of firms had decrease prices.
Selected Manufacturing Comments
“Couldn’t ship freezables many days in February, due to cold, We have a warehouse full of orders shipping this week.”
“Capital Equipment cost that are imported are a huge concern for us and the type of capital equipment we purchase is not produced in the USA for many years.”
“Markets we serve [machinery manufacturing] are down 30% for quarters 1 and 2 2025 vs quarters 1 and 2 2024.”
“The second calendar quarter is seasonally the worst. The last half of 2024 was not good, but seeing uptick in early 2025 and optimism for the year. Foreign dumping is still a problem.”
“We are in a comprehensive evaluation of all input costs and labor/production efficiencies. Based on the outcome of this research we will adjust pricing accordingly.”
“Material Costs continue to rise. Several suppliers increasing price after the beginning of the year.”
“This is a time of uncertainty for manufacturers, very difficult to make business plans.”
