State of the Conveying Industry

CEMA, the Conveyor Equipment Manufacturers Association, met in Chicago in mid-September 2016 to discuss the state of the conveyor industry and to plan for 2017. Yes, 2017 is already on the minds of the conveyor industry. Over the last six years, the conveyor industry has grown at an 11.6% CAGR. Compare this to general industry trends. Conveyor equipment has grown rapidly; capital deployment is a significant consideration within our industry. But not all segments within our industry have grown at this pace. As a member, details on the growth segments allow investments in the critical growth areas.
    
In mid-2016, the growth slowed. CEMA reports that overall industry orders (bookings) for the first six months of 2016 decreased 0.93% compared to the same period in 2015, with total orders of $5.67 billion. CEMA estimates industry billed sales (shipments) for the first six months of 2016 increased 3.15% compared to the same period in 2015, with total shipments of $6.07 billion.
    
Unit Handling orders were up 2.95% and shipments were up 11.65%. In the Bulk Conveying area, orders were down 8.87% and shipments were down 13.56%.
    
CEMA tracks new orders and shipped sales volume in nine classes of unit handling equipment and four classes of bulk handling equipment.  
    
The executives representing CEMA member companies who attended the Fall Meeting expressed some concern for the remainder of 2016. As a result of this concern, the forecast for flat shipments for 2016 remained unchanged from March 2016 forecast. Garry Abraham, CEMA president, announced the results at the meeting.
    
Several industry segments have slowed as the North American and global economy slowed in 2016. As raw materials and commodity prices drop, material changes impact demand, end market industries contract, and profits are tight, demand for the products produced by CEMA members have slowed. On the other hand, the consumer market continues to shift to Internet-based purchases. This continued shift drives demand for conveying equipment supporting ecommerce models. Overall, the conveyor industry continues to look positive heading into 2017.
    
Orders materializing in late 2017 will fuel the continued growth is this industry. Many areas are expected to rebound in 2017. Growth in agriculture, bulk products, and re-shoring of production will drive growth in many of the conveyor industry segments.
    
At CEMA, we are continually working on safety standards, product standards, design manuals, and publications preparing the conveyor industry for change.
    
For 83 years CEMA has been the “Voice of the Conveyor Industry of North America” and now we are moving to become the “Voice of the Conveyor Industry of the Americas”.
    
Daniel G. Fannin is VP commercial excellence, Power Transmission Solutions, Regal Beloit America Inc. For more information on CEMA, visit www.cemanet.org.

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