European Foundry Industry Sentiment, November 2024: FISI reflects persistent challenges amid global instability
In November 2024, the European Foundry Industry Sentiment Indicator (FISI) edged down
slightly, moving from 90.0 in November to 89.6. This decline underscores the ongoing
challenges within the foundry sector, exacerbated by economic and geopolitical turbulence.
Meanwhile, the Business Climate Indicator (BCI) displayed a modest improvement, rising from
-0.93 to -0.77, indicating cautious optimism in broader industrial expectations.
Key client industries such as construction and automotive remain under strain. The
construction sector continues to grapple with high interest rates, limiting investment in
infrastructure projects and reducing orders for cast components. The automotive industry, still
adapting to the transition towards electric vehicles, faces sluggish demand for specialized
castings, further dampening production outlooks. Adding to these challenges is the election of
Donald Trump as U.S. president-elect, a development that has introduced new uncertainties
into the global economic landscape. Trump's policies, which historically emphasized
protectionism and aggressive trade measures, have raised concerns over potential new tariffs,
trade disruptions, and supply chain realignments. For European manufacturers, this could
translate into higher costs and restricted market access, particularly if his administration follows
through on proposed tariffs targeting Chinese and European goods.
The ongoing Russia-Ukraine conflict continues to pose challenges for global trade and supply
chains, but its impacts have evolved. Traditional supply routes remain disrupted, particularly
in the Black Sea region, complicating logistics for energy and agricultural commodities.
However, businesses have increasingly adapted through regionalizing supply chains and
securing alternative sources. Despite these adjustments, energy costs and inflationary
pressures persist, influenced by sanctions and market volatility. The war has underscored the importance of supply chain resilience, prompting shifts such as “friend-shoring” and enhanced inventory strategies to mitigate risks. These developments also reflect broader geopolitical shifts, as nations reevaluate dependencies on critical raw materials from conflict zones.
As the year concludes, the foundry sector faces a volatile mix of risks and opportunities. While cautious optimism exists in some areas, overall sentiment suggests that many players are bracing for continued uncertainty into 2025.
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