Singapore's manufacturing output rises 13% in May, driven by AI-related demand

Singapore's manufacturing output rose by 13 per cent year-on-year in May, driven mainly by growth in the electronics, precision engineering and general manufacturing clusters.

Excluding biomedical manufacturing, output in May increased by 17.7 per cent, according to official data from the Economic Development Board (EDB) released on Friday (June 26).

On a seasonally adjusted month-on-month basis, manufacturing output decreased by 0.7 per cent, while output excluding biomedical manufacturing increased by 3.1 per cent.

Biomedical manufacturing dropped

Biomedical manufacturing declined 24.2 per cent in May amid softer demand for medical devices, while pharmaceuticals output contracted on lower biologics production and a different mix of active pharmaceutical ingredients, EDB said.

The highest growth of 35.8 per cent was recorded in the electronics cluster, led by the info-communications and consumer electronics and semiconductor segments, on the back of robust artificial intelligence-led demand.

Meanwhile, the precision engineering cluster grew by 32.2 per cent, with the machinery and systems segment recording higher production of semiconductor equipment while the precision modules & components segment saw increased output of optical instruments, electronic connectors and dies, moulds, tools, jigs and fixtures.

General manufacturing also saw an increase of 1.8 per cent in output, led by the miscellaneous industries segment which saw higher production of structural metal products.

Meanwhile, declines were recorded in transport engineering and chemicals clusters.

The drop in transport engineering output, by 5 per cent, is due to lower aerospace maintenance, repair and overhaul (MRO) activity, reduced work related to oil rigs and offshore platforms, and softer demand for oil and gas field equipment.

The second biggest drop, after biomedical manufacturing, was in chemicals, which fell by 11.5 per cent.

EDB said this was led by lower production in the petroleum and petrochemicals segments, due to disruptions in feedstock supply.

An EDB poll of 403 manufacturing firms between March and April indicated that precision engineering companies and electronics firms were most upbeat about the next six months, while the chemicals cluster was most pessimistic. 

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