Printers dour about Q4 output levels

The latest ‘Printing Outlook’ survey from the BPIF shows 50% of printers increased output levels in the third quarter of this year. A further 30% held output steady whilst 20% experienced a decline in output. The figures are marginally above the Q3 balances of recent years, but the forecast for Q4 is more dour - 30% forecast output will fall in Q4, which, if realised, will be the worst Q4 experienced for five years.

65% said pricing below cost continues to be their key business concern (70% previously and 81% prior to that). Paper and board prices remains the second ranked concern - selected by 47% of respondents (up from 42% last quarter and 32% prior to that). Access to skilled labour is now the third ranked concern, with 35% of respondents selecting it, putting it above late payment by customers and the previously third-ranked under-utilisation of capital equipment. As the path of negotiations continues to unwind, survey respondents are displaying even lower confidence levels regarding the outlook for the UK economy during the Brexit negotiation period and remain negative in their outlook following UK withdrawal from the EU. In comparison to last quarter, slightly more respondents (17%) are now ‘somewhat confident’ regarding the outlook for the UK economy - up from 15% in Q3. 27% are currently ‘neither confident nor unconfident’, down from 44% previously; and 50% are ‘somewhat unconfident’; up from 31% in Q3. Few respondents (1%) are in the ‘very confident’ category and 5% have now selected the ‘very unconfident’ category. Using its survey figures the BPIF ‘Brexit Barometer’ shows the ‘unconfident’ returns outweigh the ‘confident’ returns by a significant margin. The actual weighted balance is -41 - which places the current Brexit Barometer for the UK economic outlook during the Brexit negotiation period firmly in the negative side of the scale; and now in the lower half of the ‘very unconfident’ zone. This represents a continued downward shift in confidence from the -28 reported in Q3 and the +4 in Q2. Charles Jarrold, BPIF CEO, said: “Confidence levels in the printing industry for Q4 are clearly quite fragile, despite the fact trade did actually improve in Q3. The traditional Q4 boost may yet surface and alleviate some of the fears but there is no doubt that there is much to be concerned about. Brexit, cost increases, skill shortages and fluctuating demand clearly make for a difficult climate but, if the vibe from the recent industry trade shows and seminars is anything to go by, the printing industry has plenty to shout about and I know the BPIF will continue to work towards alleviating industry concerns and shouting louder to support printing.”