The headline index rose to 55.9 in May from 54.4 in April, marking the highest reading in almost four years. A PMI reading above 50 indicates expansion, S&P Global said in a press release.
The Dutch manufacturing sector expanded at its fastest pace in nearly four years in May 2026, with the Nevi Netherlands Manufacturing PMI rising to 55.9 from 54.4 in April, according to S&P Global.
The growth was driven by stronger output and new orders as companies increased stockpiling amid supply chain disruption linked to Middle East tensions.
Input cost inflation intensified further.
The improvement was driven by stronger demand, particularly from customers building safety stocks due to concerns over supply chain disruption linked to the war in the Middle East. Manufacturers reported that some clients brought forward purchases to avoid anticipated shortages and further price increases.
The growth in new orders reached its strongest level in more than four years, while manufacturing output expanded at the fastest pace over the same period. International demand also improved, although export growth remained weaker than the overall increase in order volumes.
The survey showed that Dutch manufacturers increased input buying at the quickest rate in exactly four years as firms sought to secure raw materials and components. However, intensified purchasing activity added further strain to already disrupted supply chains.
Supplier delivery times lengthened sharply in May, with the deterioration in vendor performance reaching its worst level since May 2022. Despite these delays, companies continued to increase inventories, with input stock accumulation recording its strongest pace since September 2022.
Cost pressures intensified further during the month. Input price inflation accelerated to its highest level in over four years, mainly driven by higher costs for fuel, oil-related materials, plastics, chemicals and metals linked to the Middle East conflict.
Manufacturers also raised selling prices at the fastest rate in more than three-and-a-half years, although many firms indicated they were unable to fully pass on higher input costs, resulting in continued pressure on margins.
Backlogs of work increased marginally for the first time since early 2023, suggesting some manufacturers were facing capacity constraints. Employment also rose slightly after staffing reductions in the previous two months.
Business confidence improved in May, with output expectations for the next 12 months rising above the historical average. Optimistic manufacturers outnumbered pessimistic firms by 45 per cent to 9 per cent.
Commenting on the survey, Albert Jan Swart, manufacturing sector economist at ABN AMRO, said: “The hoarding behaviour as a result of the war with Iran is driving the growth of the Dutch manufacturing sector to its fastest pace in almost four years, according to the Nevi Dutch Manufacturing PMI. Buyers fear shortages and higher prices and therefore buy extra parts and materials.”
Swart added: “The Nevi Purchasing Managers Index for the Dutch manufacturing sector rose from 54.4 to 55.9 in May, mainly due to a strong increase in new orders. Output also expanded strongly, at the fastest pace in over four years.”
He noted that demand for semi-finished products increased significantly as buyers attempted to secure additional supplies amid fears of shortages and rising prices.
“The hoarding behaviour is not illogical, given the months-long effective closure of the Strait of Hormuz as a result of the war,” Swart said. “The supply of certain chemical products, plastics and aluminium has already declined, causing purchasing prices to rise sharply since the start of the war.”
Swart also warned of the potential “bullwhip effect”, where stockpiling and fluctuating demand can lead to excess inventories and volatile production cycles.
He further highlighted that rising costs for electronic components linked to investments in artificial intelligence data centres were also contributing to inflationary pressures.
According to Swart, strong demand for Dutch industrial products may partly reflect growing investment in semiconductor and data centre infrastructure, benefiting companies connected to the chip equipment supply chain, including ASML and its suppliers.
However, he cautioned that the sustainability of the current growth momentum remains uncertain.
“Nevertheless, the question is whether the Dutch industry can maintain the current growth rate in the coming months,” Swart said. “When the hoarding effect subsides, it will become clear how resilient the demand for Dutch industrial products really is.”
Fibre2Fashion News Desk (SG)
