April saw the tariff of electricity directly provided by Eskom increasing by more than 10 per cent, this is according to the South African Chamber of Commerce and Industry’s (SACCI) trade activity index (TAI).
“The somewhat higher US dollar crude oil price is of concern given that other costs like electricity have already and also appear to be further heading for higher levels in the near future,” read SACCI’s statement.
The chamber added that the weak rand remained a concern as large quantities of inputs and consumer goods are imported.
“Price expectations hardened again in April as both the sales and input price expectations indices rose to 64 and 72 after declining to 63 and 69 respectively in March 2015,” read part of the statement.
The seasonally adjusted composite trade activity index was slightly in positive territory in April 2015, it improved by 4 index points to 51.
However, the seasonally adjusted trade conditions index is still below 56 in December 2014 and 62 in January 2015.
“The non-seasonally adjusted TAI of 49 in April 2015 is at the same level as in April 2014. It appears that over the medium-term trade conditions will remain ‘middle-of-the-road’,” read statement from SACCI.
SACCI said foreign trade appears to be improving as both import and export volumes increased while domestic demand remains under pressure given real household and public sector spending constraints.
“Supplier deliveries have improved from 42 to 44 although it seldom dips below 50,” added SACCI.
“In following the TAI, the seasonally adjusted trade expectations index (TEI) increased by two points to 54 from 52 in March 2015.”
SACCI said expectations for sales volumes increased by four index points to 62 in April 2015.
“The sales volumes sub-index dipped by 4 index points from 55 in March 2015 while new orders followed the same trend and recorded 50 in April 2015 – down from 55.”
“The sales price index remained unchanged in April at 62 while input prices declined slightly by 1 point to 69,” said SACCI.
SACCI’s report also showed the inventories index reported a strong improvement of seven index points to 54 in April 2015.