INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION

Industrial production increased 0.7 percent in February after a decrease of 0.3 percent in January. The output of utilities jumped 7.9 percent in February, as the weather moved closer to seasonal norms after January�s warm temperatures. Mining output decreased 0.5 percent in February, and manufacturing production was unchanged after a gain of 0.8 percent in January. At 110.9 percent of its 2002 average, overall industrial output in February was 3.3 percent above its February 2005 level. Because of the jump in utilities output, the rate of capacity utilization for total industry rose 0.4 percentage point, to 81.2 percent, a level just above its 1972-2005 average of 81.0 percent. Capacity utilization in manufacturing edged down in February to 80.4 percent, a rate 0.6 percentage point above its 1972-2005 average.

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION: SUMMARY
Seasonally adjusted

Industrial production	2002=100				Percent change
	2005		2006		2005		2006		Feb. '05 to Feb. '06
	Nov.	Dec.	Jan.	Feb.	Nov.	Dec.	Jan.	Feb.
Total index	109.4	110.4	110.2	110.9	.9	1.0	-.3	.7	3.3
Previous estimates	109.5	110.5	110.3		1.1	.9	-.2
Major market groups
Final Products	111.6	112.3	112.1	112.7	.1	.7	-.2	.6	4.2
Consumer goods	105.7	106.6	105.8	106.6	-.8	.8	-.7	.8	1.8
Business equipment	125.8	126.4	127.9	128.0	2.2	.4	1.2	.1	10.4
Nonindustrial supplies	110.4	111.1	109.4	110.3	.7	.7	-1.5	.8	3.8
Construction	113.4	113.2	113.3	113.0	1.0	-.2	.1	-.2	6.2
Materials	106.9	108.3	108.5	109.3	1.9	1.4	.2	.7	2.2
Major industry groups
Manufacturing (see note below)	111.7	112.2	113.1	113.1	.8	.4	.8	.0	4.2
Previous estimates	111.7	112.2	113.0		.7	.5	.7
Mining	93.1	95.7	97.8	97.3	4.5	2.8	2.3	-.5	-3.5
Utilities	104.8	108.9	96.4	104.0	-1.0	3.9	-11.5	7.9	2.2

Market Groups

The output of consumer goods climbed 0.8 percent in February; the increase was driven primarily by a jump of 6.0 percent in the production of consumer energy goods. The production of consumer durables increased 0.l percent. The production gains for appliances, furniture, and carpeting and for miscellaneous goods were mostly offset by a decline of 1.8 percent in the index for home electronics; the output of automotive products was unchanged. The output of non-energy nondurable consumer goods decreased 0.2 percent; the indexes for paper products, chemical products, and clothing all moved down.

After having risen more substantially in January, the production of business equipment edged up 0.1 percent in February to stand 10.4 percent above its year-ago level. Among the major categories of business equipment, the production of information processing equipment climbed for a second consecutive month, but the indexes for transit equipment and for industrial and other equipment turned down. The index for defense and space equipment increased further, with a gain of 0.5 percent that reflected the settlement of a strike at a producer of guided missiles and space vehicles. The production of business supplies rose 1.2 percent and was bolstered by a rebound in the output of commercial energy products; the production of non-energy business supplies was little changed. The index for construction supplies decreased 0.2 percent. Production gains for construction supplies have moderated so far this year after strong advances in the fourth quarter of last year.

The production of industrial materials rose 0.7 percent. The output of energy materials gained 1.6 percent. Among non-energy materials, the output of both nondurables and durables rose 0.3 percent, with gains of more than 1 percent in the indexes for equipment parts (in durables) and paper materials (in nondurables).

Industry Groups

Manufacturing production was unchanged in February, and the factory operating rate edged down to 80.4 percent. The output of durable goods increased 0.2 percent. The largest gains were in aerospace and miscellaneous transportation equipment, furniture and related products, computer and electronic products, and fabricated metal products. The durable goods industries in which output decreased included wood products, which declined a good bit for a second consecutive month; motor vehicles and parts; electrical equipment, appliances, and components; and machinery. The production of nondurable goods edged down 0.1 percent. Output in both the petroleum and coal products industry and the textile and product mills industry declined more than 1 percent, and smaller decreases occurred in apparel and leather, chemicals, and plastics and rubber products. Printing and support was the only major nondurable industry in which output climbed by more than 1 percent; smaller production increases came in the paper industry and in the food, beverage, and tobacco product industry. Production in the non-NAICS manufacturing industries (logging and publishing) decreased 0.2 percent in February after having declined 1.1 percent in January.

Capacity utilization for industries in the crude stage of processing was little changed at 86.0 percent, a rate 0.4 percentage point below its 1972-2005 average. For industries in the primary and semifinished stages, the utilization rate increased 0.9 percentage point, to 82.2 percent, as a result of the rebound in utilities output. For producers in the finished stage, the utilization rate was unchanged at 79.1 percent, a rate 1.2 percentage points above its 1972-2005 average of 77.9 percent.

Note. The statistics in this release cover output, capacity, and capacity utilization in the U.S. industrial sector, which is defined by the Federal Reserve to comprise manufacturing, mining, and electric and gas utilities. Mining is defined as all industries in sector 21 of the North American Industry Classification System (NAICS); electric and gas utilities are those in NAICS sectors 2211 and 2212. Manufacturing comprises NAICS manufacturing industries (sector 31-33) plus the logging industry and the newspaper, periodical, book, and directory publishing industries. Logging and publishing are classified elsewhere in NAICS (under agriculture and information respectively), but historically they were considered to be manufacturing and were included in the industrial sector under the Standard Industrial Classification (SIC) system. In December 2002 the Federal Reserve reclassified all its industrial output data from the SIC system to NAICS.

G.17 Release Tables:

Ascii	Screen reader	Summary: Industrial Production and Capacity Utilization
Chart		Chart 1: Industrial Production, Capacity, and Capacity Utilization
Chart		Chart 2: Industrial Production and Capacity Utilization
Chart		Chart 3: Industrial Production and Capacity Utilization, High Technology Industries
Ascii	Screen reader	Table 1: Industrial Production: Market and Industry Groups (percent change)
Ascii	Screen reader	Table 2: Industrial Production: Special Aggregates and Selected Detail (percent change)
Ascii	Screen reader	Table 3: Motor Vehicle Assemblies
Ascii	Screen reader	Table 4: Industrial Production Indexes: Market and Industry Group Summary
Ascii	Screen reader	Table 5: Industrial Production Indexes: Special Aggregates
Ascii	Screen reader	Table 6: Diffusion Indexes of Industrial Production
Ascii	Screen reader	Table 7: Capacity Utilization: Manufacturing, Mining, and Utilities
Ascii	Screen reader	Table 8: Industrial Capacity: Manufacturing, Mining, and Utilities (percent change)
Ascii	Screen reader	Table 9: Industrial Production: Gross Value of Products and Nonindustrial Supplies
Ascii	Screen reader	Table 10: Gross-Value-Weighted Industrial Production: Stage-of-Process Groups
Ascii	Screen reader	Table 11: Historical Statistics for IP, Capacity, and Utilization: Total Industry
Ascii	Screen reader	Table 12: Historical Statistics for IP, Capacity, and Utilization: Manufacturing
Ascii	Screen reader	Table 13: Historical Statistics for IP, Capacity, and Utilization: Total Industry excluding Selected High-Technology Industries
Ascii	Screen reader	Table 14: Historical Statistics for IP, Capacity, and Utilization: Manufacturing excluding Selected High-Technology Industries

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