A drop in the SME industry is reported: it fell by 30% in January

According to the latest report by the Argentine Confederation of Medium-sized Enterprises (CAME), the industrial production of SMEs began the year with a 30% drop in January compared to the same month of the previous year, at constant prices. This contraction marks the second consecutive month of significant decline in factory activity, following a 26.9% decline in December. The SME Industrial Production Index (IPIP) showed that companies operated with 70.8% of their installed capacity in January, representing a decrease of 2.3 percentage points compared to December. In this regard, CAME highlighted that the industrial sector is being impacted by the deterioration of purchasing power and the loss of competitiveness in international markets, especially in export-oriented companies. In addition, he noted that reducing output is usually a gradual process involving decisions on investment and employment. In terms of difficulties in replenishing stocks, a marked reduction was observed in January, from 53.4% in December 2023 to 38.8%. This decline was mainly attributed to lower demand for raw materials and inputs. Regarding the future, the entity warned of a complex outlook for SME industries in the coming months, due to threats to profitability such as the drop in consumption, persistent inflation and upcoming increases in utility rates. As for the most affected sectors, all manufacturing segments in the SME sector experienced sharp declines compared to the previous year, with “Paper and Printing” (-41.7%) and “Chemicals and Plastics” (-35.6%) standing out as the most affected.

Original source in Spanish