Confidence among Canterbury manufacturers has risen on the back of an increase in total sales.
The latest Canterbury Manufacturers' Association survey of business conditions for last month showed net confidence has increased to 8, up from the - 10 result reported in January.
Survey respondents, who collectively have
$258 million in annualised sales, reported an 8.55 per cent increase in total sales on January. Export sales were up 12.9 per cent while domestic sales increased slightly by 2 per cent.
Chief executive John Walley said Australia was among the world's most robust economies right now, presenting opportunities for New Zealand companies that sell there.
"The feeling amongst respondents is that if you are not exporting to Australia at present, you are likely wondering why you are exporting at all. A good number of our respondents see Australia as a significant market, so with a stronger Australian dollar ... it is not hard to see why sentiment has improved a bit."
For those selling beyond Australia, the pressure on margins and revenues continued to mount.
Walley said the survey closed before the latest surge in the kiwi against the US dollar, which he expected would see more New Zealand-based manufacturers downsize and move overseas.
Domestically, there was concern over the strength of the economy. "With the building sectors expected to cool, this will have an impact on some domestically focused manufacturers."
The performance index, a mix of profitability and cash flow, stands at 101, up from the previous month's 97.5, while the forecast index, which covers investment, sales, profitability and staff, is at 105.75, up from the previous month's result of 104.2. Anything less than 100 indicates a contraction.
The main constraint was market conditions, at 62 per cent, followed by the lack of skilled staff (31 per cent).
