SOUTH AFRICA · MANUFACTURING
Key Facts
- What is happening South Africa’s factory index rose to 49.6 in October from 48.7 in September, below the 50 growth line.
- Why it matters Factories are still shrinking, but more slowly, and input cost pressure is rising again in October.
- The numbers New orders 46.8, jobs 44.2, input prices 73.7 (all on a 100-point scale), six-month outlook 51.7 from 55.3.
- Who is who Absa, a major South African bank, sponsors the survey; the BER, a Stellenbosch University research unit, compiles it.
- What to watch The 4 November local elections, Durban port delays and fuel prices; the next reading is due in early December.
- What it means for you One survey, not trade data; it shows weak South African demand and a weaker rand.
South Africa’s monthly factory survey improved for a second month but still shows shrinking activity. Staff numbers are falling and costs are rising.
South Africa’s factory index rose to 49.6 in October, up from 48.7 in September, according to Absa’s monthly purchasing managers survey. Any reading below 50 means more factories report shrinking than growing.
It was the second straight monthly gain, yet the index stayed below 50, so manufacturing is still shrinking. For US readers, it points to weak demand in Africa’s most industrial economy and a weaker rand.
South Africa is the continent’s most industrialised economy, with car plants, steel mills and food factories. The Bureau for Economic Research (BER) at Stellenbosch University compiled the figures, which came out on Monday, 2 November.
What the Factory Survey Shows
Purchasing managers are the staff who buy materials for factories. Absa asks them each month whether activity, orders and jobs are rising or falling, and a score of 50 means no change.
All five parts of the headline index improved in October. Business activity rose to 48.6 from 47.7, and new sales orders rose to 46.8 from 45.4.
Employment rose to 44.2 from 42.8, so factories are still cutting staff, only more slowly. Stock levels moved back above the line, at 50.4 against 49.7 in September.
Export orders reached their highest level since early 2025 and are close to 50. The release gives no exact export figure in the version checked.
Costs and Delays Weigh on Recovery
The input price index rose to 73.7 from 71.1, the sharpest cost pressure in the survey. Respondents blamed higher fuel prices in early October and a weaker rand, which makes imported materials dearer.
Delivery times stayed long, with the supplier index at 58.1 against 58.0. Firms cited logistics problems, especially at the Port of Durban, and shortages of imported inputs.
The survey expects some fuel relief in November from temporary fuel-levy cuts, though underlying pressure has not eased. The six-month outlook slipped to 51.7 from 55.3, only just above 50.
Respondents named the 4 November local government elections, weak home demand and poor infrastructure as reasons for caution. The Independent Electoral Commission, the state election body, confirms the vote for Wednesday, 4 November.
How It Compares With September
In its first report on Thursday, 1 October, Absa put September at 50.7, the first reading above 50 in several months. The October release shows September revised down to 48.7, so the latest gain starts from a lower base.
Business activity has climbed back from a low of 41.5 in August, which shows how deep the slump was. The rise since then is real but fragile, and employment has not yet turned.
What It Means for US Readers
The survey covers South African factories only and does not split results by sector, so cars and steel are not shown. It is a mood gauge, not a count of exports to the United States.
The United States took 7.0% of South Africa’s exports in September, against 11.7% for China, according to the South African Revenue Service. That makes weak home demand and a weaker rand more relevant to US investors than any one factory number.
US firms that buy South African parts, metals or food face higher costs only if the rand falls further. On Monday the rand traded near R16.69 per US$1, using exchange rates of 2 November 2026.
Tariffs and the AGOA trade-preference programme are outside this survey, and this article does not assess them. Readers who hold South African shares or funds should treat this as one monthly input.
Related Rio Times reports include Kenya PMI Rises to 51.3 in September and the South Africa local elections guide. Background is in South Africa’s economy and key players, the South Africa hub and the Southern Africa hub.
What Would Change the Picture
A lasting rise in orders and output would be needed to lift the index above 50. Easing fuel and input costs, smoother work at Durban and a calmer rand would all help.
A weaker rand, new port delays or a poor outlook after the vote would push the index back down. Hiring is the weakest part and would be the last to recover.
What Is Not Known
The figures come from the Absa survey, compiled by the BER and published at 11:00 on Monday, 2 November. The release gives no market forecast, so none is stated here.
A separate private survey covers the whole economy, not only factories, and is not used here. No analyst forecast for this reading could be confirmed.
The release does not give an exact export orders figure in the version checked. No sector breakdown, and no link to US tariff effects, is available.
What Comes Next
The November reading is due in early December. The election result on Wednesday, 4 November comes first.
A reading above 50 would signal growth, but one month does not make a trend. The November local election result and fuel prices are the next tests.
Frequently Asked Questions
What is the Absa PMI?
It is a monthly survey of purchasing managers at South African factories. A reading above 50 signals growth and below 50 signals contraction.
What was the South Africa factory index in October?
It was 49.6, up from a revised 48.7 in September. That is still below the 50 line that separates growth from contraction.
Why are South African factories still struggling?
Weak home demand, higher fuel and input costs, and delays at the Port of Durban weigh on them. Firms are still cutting staff.
Does this affect US investors?
Only slightly. It shows weak South African demand and cost pressure, but the survey does not measure exports to the United States.
Sources: Bureau for Economic Research, Stellenbosch University, Absa PMI reports; Absa Group; South African Revenue Service, trade statistics, September 2026; Independent Electoral Commission of South Africa; Open Exchange Rates, US dollar rates, 2 November 2026 (all accessed 2 November 2026).
Editorial responsibility: Matthias Camenzind, Editor-in-Chief · Editorial standards · Report an error