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Filled order books and the latest inventory reductions bode well for industrial production in the coming months.
The modest buildup in May and June comes after a more than yearlong string of inventory reductions.
In the past, inventory reductions at this pace have always signaled strong rebounds in production within a few months.
The company, based in Atlanta, cited weak demand, pricing pressures, and customer inventory reductions that have taken a toll on the industry in recent years.
Recent inventory reductions by retailers have led to lower-than-expected soup shipments, Campbell executives told analysts in a conference call.
And since CDs remain the record industry's biggest profit engine, many analysts worry that the industry will be particularly vulnerable to inventory reductions at retail stores.
Similar(35)
The initial estimate included an inventory reduction of only $7.1 billion.
That is a sign the record pace of inventory reduction last year is nearing an end.
The rate of inventory reduction is slowing after a year in which companies reduced inventories by a record $61.7 billion.
The sharpest inventory reduction since 1983 made the downward revision bigger than expected.
"The intensity of inventory reduction is stunning," said Tobias Levkovich, a Citigroup strategist, in a note to clients.
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