US July machine tool demand drops sharply from June

WASHINGTON, Sept 7 (Reuters) - Demand for the machine tools that shape metal for products such as car engines and refrigerators plunged in July from June, two groups said in a joint report on Sunday.

U.S. July machine tool demand fell 21.5 percent to $303.44 million from $386.34 million in June, the American Machine Tool Distributors' Association (AMTDA) and the Association for Manufacturing Technology (AMT) said in a joint report.

June demand was revised upward, initially estimated at $360.43 million.

However, July demand rose 5.7 percent from $287.02 million a year earlier in July 2007.

In the year so far, demand for machine tools, which gives a sense of the pace of manufacturing, stood at $2.655 billion, up 15.5 percent from $2.298 billion in the same 2007 period.

"Despite the consecutive 1.3 percent increases in durable goods orders for June and July, manufacturing technology orders turned down sharply in July, with much of the downturn in fabricating and forming," AMTDA President Peter Borden said in a statement.

"However, 2008 remains stronger than both 2006 and 2007. The upcoming fall trade show season will provide a clearer indication of the industry's health," Borden said.

The machine tools report is generally based on a survey of about 200 manufacturers, distributors and importers of machine tools that represent 76 percent of the machine tool market. (Reporting by Jasmin Melvin; Editing by Neil Stempleman)