South Africa’s current strained trade conditions “closely resembled” the conditions experienced post the financial recession in 2007/8, the South African Chamber of Commerce and Industry’s (Sacci’s) latest survey found.

The January edition of the Trade Conditions Survey showed the seasonally adjusted composite Trade Activity Index (TAI) falling 20 index points year-on-year to 39 – at the same level as the TAI in December.

The nonseasonally adjusted TAI recovered somewhat to 39, compared with the 33 points recorded in December, but still significantly below the 62 achieved in January 2015.

The survey recorded an improvement in the sales volumes subindex from 30 in December to 42 in January, while the new orders index improved from 26 to 35.

“Supplier deliveries also improved to 32 from 29 in December, while the inventories subindex rose [month-on-month] from 43 to 46 in January,” Sacci CEO Alan Mukoki said.

In January, the sales price subindex experienced a two-point contraction to 58, while the input prices subindex, reflecting the rising cost pressures, increased from 69 in December to 74 in January.

Meanwhile, Sacci noted that trade expectations for the next six months would remain uncertain.

The seasonally adjusted Trade Expectations Index (TEI) continued its downward trend into negative territory, registering 41 in January – a decline on the 42 recorded in December and the 59 achieved in January 2015.

The January sales and new order expectations both recorded a one-point decrease from the 43 and 38 respectively posted in December.

The TEI showed sales price expectations in January marginally lower at 75, while input price expectations rose two points to 80.

“The present drought conditions and the weak rand will contribute to higher prices in the next six months,” Mukoki noted.

Employment in the trade sector deteriorated showing a subindex drop from 47 in December to 43 in January, with the subindex on employment prospects for the next six months remaining on 47.