– The production of the SME manufacturing industry rose 2.6% annually in June, at constant prices, although it fell 0.5% in the monthly comparison (against May).

– The use of the installed capacity of the companies in the sample was 72.7%, 2.5 percentage points above May, with the highest levels in Wood and Furniture (77.7%) and the lowest in Metal, machinery and equipment, and transport materials (70.9%).

– Uncertainty in the markets, rumors of devaluation, rising prices, delays in deliveries and stock shortages of some inputs complicated production for companies.

– There were no demand problems, consumption remained firm throughout the month, but the complications of the SME industry were mainly due to production.

– The first semester closes with sustained growth, slowing down in the last month. However, difficulties in terms of costs, diesel, inputs, logistics and currency restrictions for importing inputs raise a question regarding the potential for production growth in the second half of the year.

Sector analysis

The best performance in June was in the industrial branch linked to Chemical products and plastic manufactures, with an annual increase of 9.5%. The worst happened in Textiles and clothing with a new annual drop of 6.9%.

1) Food and drinks: Production rose 2.5% annually and 2.4% monthly in June. The reality of each company was completely different depending on the type of production, geographic location, or position in terms of accumulation of inputs and stocks. Companies located in border cities benefited greatly from orders from neighboring countries. “We were producing very well in June due to the greater demand from Chile, but I don't know how we are going to continue because we began to have problems with inputs, prices and delivery times”explained a wine producer from Tunuyan, in Mendoza. From Salta Meanwhile, a beverage producer showed its tightest situation: “The crisis began to be noticed, in June we had fewer orders for the production of soft drinks and soda”.

Companies in the sector worked with 71.7% of installed capacity, 0.2 points below May.

2) Clothing and textiles. Production fell 6.9% annually in June and fell 8.5% in the monthly comparison. It was a very difficult month due to the increase in supplies, the lack of products such as fabrics, dyes, threads, and the speculation of some suppliers on prices and deliveries. “There were constant increases from suppliers in raw materials, throughout the month,” a producer complained Ushuaia, in Land of Fire. But the reality was very different. “It went well for us and without supply problems, the import of propylene from Brazil entered without difficulties and 7% of the nonwoven fabrics, which is the main product we manufacture, we normally export to the same country."explained a manufacturer of King's Pass, in Province of Buenos Aires. Instead, since Santa Rosa, The Pampa They presented another reality: “These months were very bad, the fabric increased 30% and we were only able to move 10%, we are going to crash at any moment like this.”

The sector worked with 76.4% of its facilities, 2.4 points above May.

3) Wood and Furniture. In June, production fell 0.4% annually and rose 0.4% monthly. “In volume, production remained the same as last year, but there was a considerable increase in input prices and we did not transfer everything"explained a producer from the capital of Córdoba. “We are doing well because we made new investments, not because the context helps, the context makes everything increasingly difficult"explained a manufacturer from the city of Saint Benedict, in Between Rivers.

Companies worked with 77.7% of their facilities, 1.4 percentage points above May.

4) Metallic, machinery, equipment and transport material. Production rose 5.1% annually in June, but fell 1.7% in the monthly comparison. The sector produced well. There was a lot of “stocking” by some companies demanding capital goods, added to investments in agriculture, public works that pushed and industry in general that also continued to push even with the uncertainty of the month. But the sector was not immune to the general bottlenecks that the industry is experiencing. According to the businessmen consulted, they are facing three major difficulties: a) suppliers who do not deliver merchandise; b) input prices in dollars that change every day; c) obstacles to entering imported raw materials. Companies that were supplied with supplies were able to take new orders. Those that don't are on hold. The reality, however, was very heterogeneous. "We had a great billing in the last week of June that positively leveled the month, we had supplies and capacity available to comply. Since March we wanted to enter an imported machine and although we were only able to buy it this month, it was a great investment that allowed us to produce more", explained an industrialist in that sector of Buenos Aires City.

Companies worked with 70.9% of their facilities, 3.8 percentage points above May.

5) Chemicals and plastics. In June, production rose 9.5% annually and 5.6% monthly. “We are doing very well, but I don't know if we will be able to buy supplies in the coming months, because most of them are in dollars.”"warned a producer from the city of Santa Fe. “In June the production and sales levels were very good, but starting in July the macroeconomic context hurt us greatly because we cannot buy imported raw materials, we cannot import machinery that we had acquired to increase installed capacity, we cannot make payments abroad, and the suppliers are not delivering us merchandise nor do they have a price.”, summarized an SME industrialist from the city of White Bay, inside the Province of Buenos Aires.

The use of installed capacity rose to 73.3%, 2.8 points above May.

6) Paper, cardboard, editing and printing. Production in June fell 3.7% annually and also fell 5.6% monthly. Problems continued in obtaining supplies such as papers, chemicals, inks and the industry was also inconvenienced by permanent price increases. ““A sector of our printing plant could not produce in June due to the lack of papers and that is why we lost sales,” complained a producer from the city of Santiago del Estero. “There were shortages almost the entire month, it is only now returning to normal, but there are still shortages of some raw materials such as imported adhesives.”"said a producer from the city of Saint Louis. "We have problems with the processing of payments abroad, because suppliers ask us for advances. Imported supplies are not entering and these difficulties are going to take time to be resolved, that is why we are looking for alternatives"said a producer from the city of Rioja.

The use of installed capacity rose 5.7 percentage points, to 71.9%, thus recovering the levels of two months ago.