Demand for products made in the Netherlands rose the fastest in four years last month. This is evident from figures that the professional association of purchasing managers Nevi publishes monthly. The large increase in production and the number of orders is strongly related to the uncertainty about the situation in the Middle East, Nevi says.

Every month the professional association looks at various factors that say something about the industry. For example, the number of orders that have been received, but also how long the delivery times are and what companies have in stock of purchased materials.

Within this index it is striking that the chemical sector in particular was on the rise. Chemical products from the Middle East are purchased elsewhere. The production of plastics and plastics has also increased. “Good news for the industry, but not all companies are happy with it. The prices of these plastics have really risen considerably,” says sector economist Albert Jan Swart at ABN Amro.

Customers of large industrial companies are bringing forward orders to build up inventory. “Companies are hoarding products now that the Strait of Hormuz has been virtually closed for months and shortages of certain materials are occurring,” says Swart.

It did take longer to get items delivered, says professional association Nevi. Average delivery times in May were longer as companies look to replenish inventory amid further disruption to the supply chain.

The rapid growth of Dutch industry is not only because companies are now building up inventories. “Some of it can also be explained by investments in data centers by chip manufacturers. The Dutch chip machine manufacturer ASML benefits from this, as do many hundreds of suppliers,” says Swart.

He adds that the hoarding appears to be a temporary effect that will fade away in the coming months. “Only when this decreases will we see how stable the demand for Dutch goods is.”