Conveyor Industry Cautiously Optimistic In 2009

By Dan Fannin

The 95 member companies that make up the Conveyor Equipment Manufacturers Association (CEMA) represent the leading producers and designers of conveying equipment and accessories in the United States, Canada and Mexico.

Through an active statistics program, CEMA accurately tracks output statistics in over 12 product classes, provides industry standards and reference materials used throughout the world, and provides content to its members to continue the lead role serving as “The Voice of the North American Conveyor Industry.”

CEMA positioned its members for the unique dynamics of 2008 and provided a platform for 2009 by creating a strategic planning committee in 2007 and developing a five-year strategic plan. The cornerstone of this plan is content for members who participate in the various meetings held throughout the year. Content is defined as “the substantive or meaningful part.” In the words of Frederick Turner, “The brain is hungry not for method but for content, especially content which contains generalizations that are powerful, precise and explicit.”

This is what CEMA members receive. At the annual meeting in April, CEMA members were given the opportunity to listen to sustentative speakers, talk to industry experts, learn from best-in-class manufacturing executives and prepare for 2009 with an industry-renowned economist. In the summer engineering conference, engineers and executives came together to refine industry standards, continue the development of new reference and engineering materials, learn about new methods and tools of risk management, add continuing education units (CEU), and receive information on the economy's impact on engineering and design-and-build projects.

Looking at 2009
CEMA tracks new orders and shipped sales volume in seven classes of unit handling equipment and five classes of bulk handling equipment. The conveyor industry has seen strong growth for a mature industry in the last five years. From 2002 to 2007, total industry growth was 6.1%. Bulk handling equipment was up 6.3% and unit handling equipment was up 5.9%.

Overall industry billed sales (shipments) for the first six months of 2008 decreased 3.3%. In the bulk conveying area, bulk systems shipments were up significantly. Furthermore, bulk accessories bookings were up 18% and shipments by 15%. Screw conveyor shipments were up 3%. Unit handling orders were down 9% and shipments were down 10%.

CEMA member executives who attended the 2008 Fall Meeting were pleased with the 2008 year-to-date results but expressed concern over the following 12 to 18 months. 2009 is proving to be a difficult year to forecast, according to CEMA members and the combined economic activity for the industry as a whole. The dynamics in the banking industry, tightening credit, decline in the housing market, speculation over interest rates and a new president all promise to influence the industry, which weighs heavily upon warehousing and distribution, building construction, road infrastructure and energy production expenditures, as well as how aggressively businesses are willing to invest in expanding production capacity.

Even the most optimistic estimate for 2009 suggests that the combined growth for unit and bulk sides of North American conveying will be flat. Many industry leaders are predicting a slightly down year. With all this, the industry leaders remain cautiously optimistic for 2009. The election is behind us, the mortgage industry will stabilize and conveyor orders remain strong.

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The MHEDA Journal • First Quarter 2009 • Volume 38, No. 1 • Contents are Copyright © Data Key Communications, Inc.
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