Federal Reserve Bank reports decreased manufacturing activity for region

Manufacturing activity continued to decline during August in states that make up the Federal Reserve Bank of Kansas City’s Tenth District, according to a report released Thursday by the Federal Reserve.

The district encompasses Colorado, Kansas, Nebraska, Oklahoma and Wyoming; the western third of Missouri and the northern half of New Mexico. The report did not break out individual states.

Manufacturing activity declined moderately in the district, similar to the pace of the previous few months, said Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City.

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“Survey respondents reported that weak oil and gas activity along with a stronger dollar continued to weigh on regional factories,” Wilkerson said.  “Price indexes also fell after rising in recent months.”

The decrease was mostly attributable to weaker nondurable goods manufacturing, led by a reduction in food, beverage and plastics production, according to survey respondents.

The report included selected comments from survey respondents, many focusing on the strength of the dollar and cost increases.

Here is a sampling of comments:

— “The strength of the dollar, low oil prices and increased regulation are making business very difficult and decreasing international competitiveness through cost increases.”

—  “Our year-to-date has been up from last year and our cash flow position is better; however, the next six months appear shaky at best.”

— “I speak to many other business executives who do exporting and all seem to be quite concerned about the dollar strength and the devaluation of the Chinese currency.”

— “Delivery of imported goods delayed due to the west coast strike. We are still feeling effects of delays due to trucking and rail.”

—  “Capital spending by oil and gas producers continues to be restrained. All companies like ours are negatively impacted when the spending curve is trailing downward.”

— “Our product is geared toward colder weather. We are having a great increase in orders for this time of the year, which is nice to see. Fourth quarter is looking promising.”