In May, Turkey’s manufacturing sector showed promising signs of stabilization as production levels increased and export orders rose for the first time in 21 months. This development was highlighted in a survey conducted by the Istanbul Chamber of Industry, with the Manufacturing Purchasing Managers’ Index (PMI) compiled by S&P Global reaching 49.8, up from 45.7 in April. The PMI’s 50-mark is the threshold between growth and contraction, making the May reading the highest since March 2024.

Export Orders and Production Growth

The renewed growth in export orders played a significant role in supporting the slight rise in production. According to Andrew Harker, Economics Director at S&P Global Market Intelligence, the sector moved in a more positive direction due to this increase in exports. Despite this, total new business slightly eased as firms continued to face uncertainties, higher prices, and the ongoing conflict in the Middle East.

Employment within the sector continued to decline, albeit at the slowest pace so far in 2026. Companies also increased their purchasing activity for the first time in over two years, partly to build safety stocks in response to rising prices and disrupted supply chains.

Challenges and Future Outlook

Input costs remained a challenge, with firms reporting higher prices for fuel, oil, metals, and transportation. Although both input cost and output price inflation eased somewhat, suppliers’ delivery times lengthened for the seventh consecutive month. Harker noted that sustaining the expansions seen in May would depend on whether total new orders could join exports in growth territory in the coming months.

The manufacturing sector’s performance is crucial for Turkey’s economy, and these recent developments offer a cautiously optimistic outlook. However, the ongoing challenges of input cost increases and supply chain delays remain significant hurdles that need to be addressed for sustained growth.

Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.