Singapore manufacturing expands as electronics lift March PMI to 50.5

Electronics PMI hit 51.4 sustaining factory momentum.

Industrial activity in Singapore expanded in the first quarter (Q1) of 2026, despite the Middle East conflict, supported by electronics demand linked to artificial intelligence (AI) and semiconductors.

The latest ETC Digest by OrangeTee & ETC Research cited data from the Singapore Institute of Purchasing and Materials Management, stating that the city-state’s purchasing managers’ index (PMI) rose to 50.5 in March 2026 from 50.3 in December 2025, marking eight consecutive months in expansion territory.

The electronics PMI increased to 51.4 in March 2026 from 50.9 in December 2025, marking the 10th straight month of expansion.

Demand for semiconductors, AI hardware, and data centre components supported the electronics segment, the report added.

Industrial rents increased in Q1 2026, as the JTC all-industrial rental index rose 0.4% quarter on quarter (QoQ) to 113.2, compared with 0.5% in the fourth quarter (Q4) of 2025.

All industrial segments recorded quarterly rental growth, whilst single-user factories recorded a 1% increase.

Rental volume declined for a third consecutive quarter to 2,964 units, down 3.4% from the previous quarter, the firm added in the report.

Industrial property prices rose at a slower pace, with the JTC price index for all industrial properties increasing 1.2% in Q1 2026, compared with 1.4% in Q4 2025.

Multiple-user factories recorded a 1.7% increase, whilst prices for single-user factories fell 0.1%.

Urban Redevelopment Authority Realis caveat data showed 386 industrial property transactions in Q1 2026, down 16.1% from 460 in Q4 2025.

Occupancy for all industrial space rose to 88.9% in Q1 2026 from 88.7% in Q4 2025.

Occupancy in multiple-user factories and single-user factories increased by 0.3 percentage points and 0.4 percentage points, respectively.

Business park occupancy fell to 76.7% from 77.1%, whilst warehouse occupancy fell to 89.4% from 89.8%.

Industrial stock increased by around 1.4 million square feet (sq ft) of gross floor area in Q1 2026. Smart Food @ Mandai and Stellar@Tampines were completed in the quarter.

Based on planning approvals as of March 2025, around 8 million sq ft of industrial space is scheduled for completion over the next three quarters.

The firm said in the report that the Middle East conflict could lift energy prices and increase production and logistics costs.

The electronics segment is expected to remain supported by investment from the Economic Development Board.

Occupiers may take a more cautious approach to industrial leasing, whilst rents are projected to grow 1% to 3% in 2026.