Singapore’s factory output rises 10.6% in December, beats expectations

SINGAPORE’S factory output rose 10.6 per cent year on year in December, with all clusters recording growth, based on data released by the Economic Development Board on Friday (Jan 24).

This outpaced economists’ forecasts of a 6.2 per cent expansion, in a poll by Bloomberg. However, December’s print came in slightly below November’s revised growth of 10.8 per cent.

Excluding the volatile biomedical sector, December’s industrial production similarly grew 10.6 per cent from the year before, though it moderated from November’s revised growth of 16 per cent.

DBS economist Chua Han Teng attributed December’s strong performance to broad-based growth across all clusters. “Precision engineering saw steady single-digit growth, while biomedical, chemicals, transport engineering, and general manufacturing reversed their declines in December,” he said.

Maybank economists Chua Hak Bin and Brian Lee noted that Singapore’s manufacturing sector recorded “strong output” in November and December, likely driven by the frontloading of shipments in anticipation of heightened trade barriers during US President Donald Trump’s second term.

Output in the key electronics sector rose 14.3 per cent year on year (yoy) in December, down from 31.3 per cent in November.

Within the sector, some segments expanded: infocomms and consumer electronics grew 41.2 per cent; computer peripherals and data storage rose by 27.1 per cent, and semiconductors, by 11.4 per cent. However, the other electronic modules and components segment contracted by 9.2 per cent.

Yoy in 2024, the electronics cluster posted an 8.4 per cent rise in output.

All other clusters also registered year-on-year growth:  

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Singapore’s factory output rises 8.5% in November, below estimates

• Transport engineering (16 per cent)
• Biomedical manufacturing (9.4 per cent)
• Precision engineering (3.9 per cent)
• General manufacturing (3.7 per cent)
• Chemicals (3.1 per cent)

However, on a seasonally adjusted, month-on-month basis, manufacturing output fell 0.7 per cent in December. Excluding biomedical manufacturing, output dropped 5.3 per cent.

Looking ahead, OCBC chief economist Selena Ling noted uncertainty over whether frontloading activities ahead of Trump’s potential tariffs can be sustained.

It is unclear “when the tariffs will materialise, to what extent and whether they will be universal in nature, as well as if there will be retaliatory moves”, she noted.

DBS’ Chua expects the strong manufacturing performance to “continue in early 2025”, driven by resilient near-term external demand for goods.

Tariffs remain a focus for Trump’s new administration, even though they have yet to be implemented, and this could bolster Singapore manufacturers’ near-term prospects through further frontloading, he added.