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Cutting Tool Demand Surging at Midyear

Aug. 19, 2021
At $172.1 million for June, machine shops’ consumption of cutting tools rose 7.5% over the previous month’s total – and now is 20.5% higher year-over-year.

U.S. machine shops and other manufacturers consumed $172.1 million worth of cutting tools during June, 7.1% over than the May total ($160.7 million) and 20.5% higher than the June 2020 ($974.7 million) result. The Cutting Tool Market Report, from which the results are drawn, tracks cutting-tool consumption as an indicator of current manufacturing activity.

“The U.S. economy has fully recovered from its short recession and is entering (the) second half of 2021 in boom conditions,” according to consultant Eli Lustgarten, cited by the U.S. Cutting Tool Institute. “We expect that the recovery of cutting-tool demand should continue through the remainder of 2021 and well into next year.”

That outlook is consistent with the recent U.S. Manufacturing Technology Orders report – a forward-looking index to future manufacturing activity based on new orders for CNC machine tools. The USMTO report showed machine-tool orders are up 48.6% YTD over 2020.

Still, through the first six months of 2021, U.S. cutting-tool consumption totaled $974.7 million, putting 2021 just 1.8% higher than the January-June 2020 total.

USCTI and AMT - The Assn. for Manufacturing Technology collaborate to produce the monthly report based on the actual figures reported by companies participating in the CTMR program, who represent a majority of the U.S. market for cutting tools. 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.

Bret Tayne, president of USCTI, stated: “The cutting-tool market resumed its upward march in June. The 12-month moving average improvement is in a healthy range. The cutting-tool market continues to experience short-term volatility from a variety of factors, but the overall trend remains positive.”

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