The manufacturing sector recorded a modest recovery in May, with production rising 0.5% year on year, Stats SA data shows.
Manufacturing accounts for about 13% of GDP.
The rebound follows a sharp 6.4% annual decline in April and exceeded economists’ forecasts of a continued contraction.
Nedbank had expected a decline of 0.5% while Investec projected a steeper fall of 2.8%, citing weakness reflected in May’s Absa purchasing managers index. The actual reading, released on Thursday, outperformed both estimates.
“The improvement in SA manufacturing activity during the first two months of [the second quarter of] 2025 is obviously extremely welcome and will help to offset the decline during [the first quarter], boosting SA’s second quarter GDP performance, said Kevin Lings, Stanlib chief economist.
“However, it is not clear if the uplift in April/May will be sustained. It was hoped that the scaling back of load-shedding over the past year would boost SA’s industrial production, however this has not yet been evident in the production activity.”
The performance was driven primarily by stronger output in the basic iron and steel, nonferrous metals, metal products and machinery division, which grew 4.3% and added 0.9 of a percentage point to overall production.
By contrast, the motor vehicles, parts and other transport equipment sector remained a significant drag, shrinking 6.7% year on year and cutting 0.6 of a percentage point from the total.
This sector, Lings said, “is facing extreme uncertainty associated with [US] President [Donald] Trump’s tariff policy”.
Seasonally adjusted figures paint a more upbeat monthly picture. Production climbed 2% in May compared with April, after a 1.7% increase in the previous month. However, output over the three months to end-May fell 0.3% relative to the preceding three months, underscoring persistent headwinds in the manufacturing economy.
Four of the 10 main divisions recorded negative growth for this period, led by food and beverages, which declined 3% and subtracted 0.8 of a percentage point. This time, motor vehicles, parts and equipment contributed positively, up 7.9%, contributing 0.6% of a percentage point.
However, the weakness in consumer-facing industries tempered the gains in metals and transport equipment in the same period.
Manufacturing sales also reflected tentative improvement, increasing 1.8% month on month in May after consecutive declines in March and April. Yet, in quarterly terms, sales were down 0.7% compared with the preceding three months, weighed by a 5.3% decline in the metals and machinery category. The largest positive contribution was reported for the motor vehicles, parts and accessories and other transport equipment division.
“Despite the improvement in April and May, SA manufacturing is about 5% below the level of output achieved before the start of Covid-19 in 2020,” Lings said.
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