Advance Durable Goods Orders: The U.S. Census Bureau reported that new orders for durable goods in June 2021 increased by 0.8% month on month (m/m) to $257.6M, following the 3.2% increase in May. The always-volatile nondefense aircraft orders, up 1000+% y/y, influenced this trend significantly.

The Advance Report on Durable Goods (DG) is based upon data reported from manufacturing establishments with $500 million or more in annual shipments. Units may be divisions of diversified large companies, large homogenous companies, or single-unit manufacturers in 89 industry categories.

Capital goods orders increased by 2.6% for the month and are up 40.0% on a y/y basis. Transportation orders increased by 2.1% and were up 54.1% vs. a year ago. Leaving out transportation business, orders increased 0.3% m/m and increased 18.0% y/y.

Orders for motor vehicles and parts were down 0.3% m/m, but still up 27.2% y/y. Orders for primary metal were up 0.4% m/m and have increased 26.6% y/y. Durable goods shipments increased 1.0% m/m and are up by 15.5% vs. a year ago. Capital goods shipments increased by 1.6% m/m and are up 13.2% y/y.

Figure 1 shows the history of DG orders from 2010 to present. New orders totaled $257.6M in June, a 24.2% increase y/y.

At Gerdau, we routinely monitor advance durable goods orders since it provides a good read on the current health of the U.S. manufacturing economy and its probable short-run future. This is one of the earliest indicators of both consumer and business demand for U.S. manufactured equipment.