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Cutting-Tool Consumption Down for Third Straight Month

July 16, 2021
Orders for cutting tools are down 1.5% year-to-date over 2020, and AMT cites supply-chain problems for the continuing drop in manufacturers’ demand – taken as an indicator of overall manufacturing activity.

U.S. machine shops’ and other manufacturers’ consumption of cutting tools declined -5.5% from April to $160.7 million in May 2021, the third consecutive monthly decline for what is considered a reliable index to current manufacturing activity. While the latest figure is 24.6% higher than the May 2020 total, it puts the current year-to-date total for cutting-tool consumption at $802.6 million, -1.5% below the January-May 2020 total.

“The cutting tool industry hope -- not strategy -- in March was that sales volumes would continue to move toward pre-pandemic values,” explained Brad Lawton, chairman of AMT’s Cutting Tool Product Group. “Industry sales slowed month over month in May because of supply-chain issues after sales were up in March, significantly due to quarterly restocking by distributors.”

AMT - The Assn. for Manufacturing Technology and the U.S. Cutting Tool Institute track cutting-tool consumption in the monthly Cutting Tool Market Report. Because cutting tools are required in the production of a wide variety of parts and components supplied to a range of industrial sectors, cutting-tool consumption is taken as an index of current manufacturing activity, comparable to shipments of durable goods.

CTMR data reflects actual results reported by companies participating in the program and represent a majority of the U.S. market for cutting tools.

The slow pace of consumption contrasts with the quickening pace of new orders for machine tools during May, though those results are indicative of future manufacturing activity.

“Despite these conditions, the cutting tool industry remains poised to respond to U.S. manufacturing customers,” Lawton added.

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