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Release Date: March 16, 2021
Revision of Industrial Production and Capacity Utilization Notice Below

In February, total industrial production decreased 2.2 percent. Manufacturing output and mining production fell 3.1 percent and 5.4 percent, respectively; the output of utilities increased 7.4 percent.

The severe winter weather in the south central region of the country in mid-February accounted for the bulk of the declines in output for the month. Most notably, some petroleum refineries, petrochemical facilities, and plastic resin plants suffered damage from the deep freeze and were offline for the rest of the month. Excluding the effects of the winter weather would have resulted in an index for manufacturing that fell about 1/2 percent and in an index for mining that rose about 1/2 percent. Both indexes would have remained below their pre-pandemic (February 2020) levels.[1]

At 104.7 percent of its 2012 average, total industrial production in February was 4.2 percent lower than its year-earlier level. Capacity utilization for the industrial sector decreased 1.7 percentage points in February to 73.8 percent, a rate that is 5.8 percentage points below its long-run (1972–2020) average.

Industrial Production and Capacity Utilization: Summary
Seasonally adjusted
Industrial production 2012=100 Percent change
2020 2021 2020 2021 Feb. '20 to
Feb. '21
Sept.[r] Oct.[r] Nov.[r] Dec.[r] Jan.[r] Feb.[p] Sept.[r] Oct.[r] Nov.[r] Dec.[r] Jan.[r] Feb.[p]
       
Total index 102.8 103.8 104.8 105.8 107.1 104.7 -.1 1.0 .9 1.0 1.1 -2.2 -4.2
Previous estimates 102.8 103.9 104.9 106.2 107.2   -.1 1.1 .9 1.3 .9    
       
Major market groups
Final Products 98.8 99.5 100.1 101.3 102.6 101.4 -.8 .7 .7 1.2 1.2 -1.1 -1.2
Consumer goods 104.0 104.5 104.8 106.4 107.4 106.8 -1.0 .4 .3 1.5 .9 -.6 .9
Business equipment 90.9 91.8 93.4 93.9 95.3 92.3 -.4 1.0 1.7 .5 1.5 -3.1 -5.8
Nonindustrial supplies 101.3 103.7 104.1 105.4 105.7 104.2 .6 2.4 .3 1.3 .3 -1.5 -5.1
Construction 111.2 114.0 114.8 116.1 117.0 114.4 .9 2.5 .7 1.1 .8 -2.2 -4.7
Materials 106.3 107.3 108.6 109.5 111.0 107.1 .3 .9 1.3 .8 1.4 -3.5 -6.6
       
Major industry groups
Manufacturing (see note below) 99.4 100.9 101.8 102.6 103.8 100.7 .1 1.4 1.0 .7 1.2 -3.1 -4.1
Previous estimates 99.4 100.9 101.9 102.8 103.9   .0 1.5 1.0 .9 1.0    
Mining 114.3 112.2 116.1 116.6 119.0 112.6 .9 -1.8 3.4 .4 2.1 -5.4 -15.3
Utilities 102.6 104.2 101.6 105.4 104.8 112.5 -2.2 1.5 -2.5 3.8 -.6 7.4 10.1

Capacity utilization Percent of capacity Capacity
growth
Average
1972-
2020
1988-
89
high
1990-
91
low
1994-
95
high
 
2009
low
 
2020
Feb.
   
2020 2021 Feb. '20 to
Feb. '21
Sept.[r] Oct.[r] Nov.[r] Dec.[r] Jan.[r] Feb.[p]
       
Total industry 79.6 85.1 78.8 85.0 66.7 76.9 72.5 73.2 73.9 74.6 75.5 73.8 -.1
Previous estimates             72.4 73.3 73.9 74.9 75.6    
       
Manufacturing (see note below) 78.1 85.5 77.3 84.6 63.7 75.2 71.4 72.4 73.1 73.7 74.6 72.3 -.3
Previous estimates             71.3 72.4 73.2 73.9 74.6    
Mining 87.0 86.3 84.3 88.6 78.3 89.1 77.8 76.6 79.5 80.0 81.8 77.5 -2.7
Utilities 84.9 93.2 84.7 93.2 78.2 73.5 72.5 73.4 71.3 73.9 73.3 78.5 3.1
       
Stage-of-process groups
Crude 86.1 87.8 84.7 90.0 76.4 87.6 78.0 78.2 80.8 81.5 82.8 76.6 -2.1
Primary and semifinished 80.1 86.4 78.1 87.8 63.9 75.0 70.7 72.0 71.8 72.7 73.2 73.0 .2
Finished 76.6 83.3 77.3 80.6 66.5 74.0 71.6 72.0 72.9 73.4 74.5 73.1 .2
[r] Revised. [p] Preliminary.
Market Groups

Most market groups posted losses in February, with the largest decrease of 14.5 percent coming from chemical materials as a result of the shutdowns at plants producing petrochemicals and plastic resins. Consumer energy products posted the only noteworthy increase, jumping 5.6 percent on a surge in utility output.

Industry Groups

Manufacturing output decreased 3.1 percent in February. The indexes for durable, nondurable, and other (publishing and logging) manufacturing fell 2.6 percent, 3.7 percent, and 0.5 percent, respectively. Among durables, many industries experienced decreases of between 1 and 3 percent. The largest drop, 8.3 percent, was posted by motor vehicles and parts, while the only increases were recorded by primary metals and by aerospace and miscellaneous transportation equipment. The cutback in the output of motor vehicles and parts, which reflected both a global shortage of semiconductors and the severe weather, reduced overall manufacturing output about 1/2 percent. Among nondurables, most industries recorded losses. The largest reductions occurred in those industries most affected by the weather: The indexes for chemicals and for petroleum and coal products decreased 7.1 percent and 4.4 percent, respectively.

The output of utilities increased 7.4 percent in February, as the extremely cold winter weather boosted demand for heating. Mining production decreased 5.4 percent; a drop of more than 6 percent for oil and natural gas extraction accounted for most of the loss. The index for oil and gas well drilling continued its climb with an advance of 6.4 percent, though it remained about 50 percent below its year-earlier level.

Capacity utilization for manufacturing decreased 2.3 percentage points in February to 72.3 percent. The operating rate for mining decreased 4.3 percentage points to 77.5 percent, while the operating rate for utilities increased 5.2 percentage points to 78.5 percent; both rates remained below their long-run averages.

Revision of Industrial Production and Capacity Utilization

The Federal Reserve Board plans to issue its annual revision to the indexes of industrial production (IP) and the related measures of capacity utilization in the first half of 2021. New annual benchmark data for manufacturing for 2017 through 2019 will be incorporated, as well as other annual data, including information on the mining of metallic and nonmetallic minerals (except fuels). The weights for market-group splits of the industry-level indexes will be updated with information from the 2012 benchmark input-output accounts from the U.S. Bureau of Economic Analysis. The updated IP indexes will include revisions to the monthly indicator (either product data or input data) and to seasonal factors for each industry. In addition, the estimation methods for some series may be changed. Any modifications to the methods for estimating the output of an industry will affect the index from 1972 to the present.

Capacity and capacity utilization will be revised to incorporate data for manufacturing through the fourth quarter of 2020 from the U.S. Census Bureau's Quarterly Survey of Plant Capacity Utilization, along with new data on capacity from the U.S. Geological Survey, the U.S. Department of Energy, and other organizations.

Note. The statistics in this release cover output, capacity, and capacity utilization in the U.S. industrial sector, which is defined by the Federal Reserve to comprise manufacturing, mining, and electric and gas utilities. Mining is defined as all industries in sector 21 of the North American Industry Classification System (NAICS); electric and gas utilities are those in NAICS sectors 2211 and 2212. Manufacturing comprises NAICS manufacturing industries (sector 31-33) plus the logging industry and the newspaper, periodical, book, and directory publishing industries. Logging and publishing are classified elsewhere in NAICS (under agriculture and information respectively), but historically they were considered to be manufacturing and were included in the industrial sector under the Standard Industrial Classification (SIC) system. In December 2002 the Federal Reserve reclassified all its industrial output data from the SIC system to NAICS.

[1] The methods used to estimate the effects on the industrial production indexes of the severe winter weather are similar to those used to estimate the effects of other major storms and are described in a Technical Q&A (https://www.federalreserve.gov/releases/g17/g17_technical_qa.htm\#hurricaneharvey2017) and a FEDS Note (https://www.federalreserve.gov/econres/notes/feds-notes/natural-disasters-and-the-measurement-of-industrial-production-hurricane-harvey-a-case-study-20171011.htm).
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Last Update: March 16, 2021