On October 8, the China Logistics and Purchasing Federation released data showing that the warehouse index for September 2024 is at 49.8%, which reflects a slight decrease of 0.4 percentage points from the previous month. Industry experts maintain a positive outlook, noting that the overall performance of the sector remains stable.
Yang Biao, Deputy General Manager of China Storage Development Co., shared his insights on the situation. He attributes the modest change in the warehouse index to a drop in the end-of-period inventory index, signaling a quicker pace of inventory reduction. He emphasized that the Chinese warehousing industry is still on a steady upward trajectory.
Diving into the specifics, a look at the sub-indices reveals that the new orders index, facility utilization index, average inventory turnover index, and business activity outlook index all saw increases ranging from 0.4 to 3.4 percentage points compared to last month. However, both the end-of-period inventory index and employee index experienced declines.
In September, the new orders index stood at 49.1%, and the facility utilization index was recorded at 50.4%. These figures show improvement, indicating a reduction in the decline of new orders and a rise in the use of warehousing equipment. The business activity outlook index for September reached 54.8%, up by 0.8 percentage points from the prior month, suggesting that companies are optimistic about their future operations. As we look towards October, analysts note that the bulk commodity market is in its peak season, and early e-commerce promotional activities are boosting consumer markets, which points to increased demand for warehousing services.
Analysts have pointed out that while the warehousing sector faced some downward pressure in the third quarter, there has been a rebound as the season wrapped up, with signs of stabilization emerging. The easing of short-term seasonal disruptions in August and September, combined with the peak season for bulk markets and positive macroeconomic trends, has led to increased demand for warehousing. Forecasts indicate that this demand may continue to rise in the fourth quarter, suggesting a trend of steady growth for the industry.
