US factory demand strengthens while delivery times and input prices remain elevated

The Institute for Supply Management’s Manufacturing PMI reached 55.6 in July, its highest level since May 2022 and the seventh consecutive month of manufacturing expansion. New orders, production, employment, inventories, and supplier deliveries were all in expansion territory.^[1]

The supplier-deliveries index rose to 58.9, indicating slower delivery performance for an eighth consecutive month. The prices index remained high at 71.1, meaning raw-material prices increased for a twenty-second consecutive month even as the rate of increase eased from June.^[1]

Category teams should separate demand growth from supplier health. A fuller order book can lengthen queues, but delays can also reflect smaller-supplier stress, material shortages, logistics constraints, or capacity being allocated to more attractive customers.

The report’s buying-policy data also shows longer average commitments for production materials and maintenance, repair, and operating supplies. Forecast accuracy, supplier communication, and contractual lead-time assumptions deserve another review before the next planning cycle.

ISM reported slower deliveries across thirteen manufacturing industries. Steel, aluminum, electronics, freight, plastics, resins, semiconductors, and several related inputs were among the commodities reported up in price, making category-level evidence more useful than a single economy-wide view.