Mold making Index results between January and October of 2017 broke records with an average index reading of 55.8. By comparison, the last time the index experienced a comparable period of prolonged expansion was in 2014, when the average index reading from January to October was a respectable 53.8.

When interpreting Industry Intelligence data, a reading of 50.0 means that no change in the industry has occurred. All index readings above 50 represent growth. The greater the number is above 50, the faster the speed at which the industry is expanding. Readings below 50 work in a similar manner but represent industry contraction. The index is calculated by six underlying business conditions: backlog, employment, exports, new orders, production and supplier deliveries. The total index is the average of the movement of these six drivers. During a typical month, all six drivers may be expanding, but those expanding below the average of the six are considered to “pull the index down.”

The two most significant drivers of the Mold making Index in 2017 have been the production and new orders components, both of which had multi-year high growth values in 2017 that easily surpassed high records from the past. The readings for new orders in 2017 have been especially strong, which likely explains the growth in backlog and exports figures in 2017. At the end of October, backlog readings reached their 10th consecutive month of expansion. This far surpasses the most recent record for consecutive months of backlog growth, which lasted for three months.

Growth in new orders, which Industry Intelligence uses as a proxy for demand, has greatly improved in 2017. Data on prices in 2017 indicates that this increased demand for molds is resulting in improved pricing for mold builders. Readings of prices received began improving (or having index scores above 50) in the third quarter of 2016 and have steadily improved through to the present. The full history of data suggests that the industry can expect further expansion in the industry well into the future when the Mold making Index registers strong backlogs and strong pricing power.