(The Epoch Times)—America’s manufacturing sector saw its sharpest contraction in over a year in September even as overall business activity growth remained robust, according to new data from S&P Global, which also showed inflationary pressures reaccelerating.
The latest S&P Global U.S. Manufacturing PMI, a survey-based monthly overview of factory activity in the United States, fell deeper into recession territory in September, data released on Sept. 23 shows. The manufacturing index slumped to 47.0 in September, down from August’s 47.9 and the lowest in 15 months. Readings below 50 represent a contraction in activity.
The decline signals continued deterioration in business conditions within the manufacturing sector, which has been plagued by weakening demand and falling new orders. In particular, new orders in September fell at their fastest pace since December 2022, as manufacturers struggled with declining export demand and reduced domestic sales.
Slumping employment also made a significant negative contribution to the downbeat manufacturing figures, with job losses accelerating at a pace not seen since June 2020.
“Excluding the pandemic, the decline in factory jobs was the steepest since January 2010 as an increasing number of firms reported the need to reduce operating capacity in line with weak sales,” the S&P Global report states.
Cracks in the labor market were behind the Federal Reserve’s decision last week to deliver a large, 50-basis point interest rate cut, with one Fed official saying on Sept. 23 that he was surprised by the pace of deterioration in employment conditions.
“Progress on inflation and the cooling of the labor market have emerged much more quickly than I imagined at the beginning of the summer,“ Atlanta Federal Reserve President Raphael Bostic, a voting member of the Fed’s interest-rate-setting council, said in comments to the European Economics and Financial Centre. ”In this moment, I envision normalizing monetary policy sooner than I thought would be appropriate even a few months ago.”
The central bank’s rate-setting body, the Federal Open Market Committee (FOMC) of which Bostic is a voting member this year, decided last week to lower rates to within a range of 4.75–5.0 percent.
Markets are fully pricing in another rate cut when the policymaking panel meets again on Nov. 7, with the odds split roughly evenly between a smaller quarter-point cut or another jumbo half-point reduction.
But while central bank officials celebrate inflation falling closer to the Fed’s 2 percent target, Monday’s S&P Global data suggests it may be too soon to declare victory in the fight against high prices.
Inflationary pressures picked up across both goods and services, per the S&P Global report, with the increase driven mostly by rising input costs. Prices charged for goods and services rose at their fastest pace in six months, with service sector costs surging due to wage growth. Input costs in services grew at their highest rate in a year, reflecting increased labor expenses, while manufacturing input cost growth cooled slightly, aided by lower energy prices and fewer supply chain snags.
“The survey’s price gauges meanwhile serve as a warning that, despite the PMI indicating a further deterioration of the hiring trend in September, the FOMC may need to move cautiously in implementing further rate cuts,” Chris Williamson, chief business economist at S&P Global, said in a statement.
In contrast to a deepening slump in manufacturing, service sector activity grew at a solid pace in September, per the S&P Global report. The services business activity index came in at 55.4, a slight decline from August’s 55.7. Relatively robust growth in services helped lift the composite PMI measure—which combines both manufacturing and services—to 54.4 in September, a slight decline from the prior month.
“The early survey indicators for September point to an economy that continues to grow at a solid pace, albeit with a weakened manufacturing sector and intensifying political uncertainty acting as substantial headwinds,” Williamson wrote, while partly blaming election-related uncertainty for a sharp slump in optimism about business output in the year ahead.
The deterioration in output-related confidence sent the sentiment gauge to its lowest level since October 2022 and the second-lowest since the pandemic.
Two Storms, One Harvest
Every food crisis in living memory has been a one-shock event. The 2008 price spike was a commodity bubble. The 2020 shortages were a logistics failure. The 2022 grain scare was a war on one exporter’s ports. Each time, the system bent, adjusted, and recovered, and each time the experts assured us afterward that global markets are simply too big and too diversified to fail.
What nobody in Washington seems eager to discuss is that 2026 is shaping up to be something the modern food system has never actually faced. Two independent shocks, one climatic and one geopolitical, are converging on the same harvest cycle at the same time. Not sequentially. Simultaneously.
Start with the weather. The Pacific Ocean is currently building toward what forecasters now openly call a record event. NOAA’s Climate Prediction Center puts the odds of at least a strong El Niño near 88 percent, with roughly two in three odds it reaches “very strong” status, the tier reserved for perhaps three or four events in the entire satellite era. Every major global model now projects a median peak in Super El Niño territory, and most of them project it exceeding the 2015-16 event, which until now held the modern record. Sea surface anomalies were already brushing the super threshold in mid-July, months before these events normally peak. The atmosphere has already shifted into El Niño mode, and the event is forecast to crest in late fall and early winter.
This is not about “climate change.” It’s about the standard cycles of weather, and the cycle we’re currently in is one that has likely devastated societies in the past. We’re better prepared as a society today, but not all Americans are equally prepared.
Serious households have started doing the quiet math on their own. Grocery bills tell part of the story, and the forecast maps tell the rest, which is why long-term food storage has moved from fringe hobby to mainstream line item in the family budget, with established suppliers like Heaven’s Harvest seeing demand from people who five years ago would have rolled their eyes at the idea. That instinct is not paranoia. It is pattern recognition, and the pattern is worth walking through carefully.
Editor’s Note: Heaven’s Harvest IS a sponsor, but the warnings of this article are real and would be written even if we didn’t have a survival food sponsor. With that said, those who take advantage of what they offer can use promo code “Patriot” for 15% off.
The Fertilizer Clock Is Already Running
While the Pacific warms, the second shock has been unfolding in the Strait of Hormuz. The conflict with Iran turned the world’s most important energy chokepoint into a contested waterway, and the consequences reach far beyond the gas pump. Roughly a third of global fertilizer trade moves through Hormuz, and the disruption sent urea prices up 86 percent year over year by March, with a 53 percent jump in a single month.
The World Bank projects energy prices rising about 24 percent in 2026 and fertilizer about 31 percent. By its own accounting, fertilizer prices ran 35 percent higher in the first five months of this year than the same period last year.
Here is the mechanism the nightly news will not explain. Fertilizer is not a grocery item. It is a time-delayed input. The nitrogen a farmer in Iowa or Punjab could not afford to apply this spring does not show up as a problem this spring. It shows up as a thinner harvest six to twelve months later.
The World Bank’s own food security brief concedes that the effects of reduced applications earlier this season “are likely to become visible only later in harvest outcomes.” Translate that from institutional language into plain English and it means this. The damage is already done, it is already in the ground, and we are simply waiting for it to arrive on the shelf.
Now check the calendar. Six to twelve months from the spring planting season lands us squarely in late 2026 and early 2027. Which is precisely when the strongest El Niño in the instrumental record is forecast to peak, bringing its signature droughts to Southeast Asia, Australia, southern Africa, northern Brazil, and South Asia, the very regions that grow the world’s rice, sugar, and oilseeds.
The World Bank warns openly that a strong El Niño “could disrupt multiple crop belts simultaneously” on top of the conflict-driven input costs. Their baseline projection assumes the Middle East disruptions ease by autumn. What in the last two years of Middle East history suggests that assumption is safe?
The System Has No Slack Left
The comfortable answer is that global markets always adjust. But adjustment requires slack, and the slack is gone. Global cereal production is expected to decline from last year’s records even before El Niño does its work. The UN World Food Programme, hardly a den of right-wing preppers, is calling this the most significant disruption to its supply chains since Covid and the invasion of Ukraine, and its supply chain director put the stakes bluntly.
Today’s supply chain challenges are tomorrow’s hunger crisis.
There is also a political dimension that markets cannot price. When food gets scarce, governments do not behave like economists. They behave like politicians. Export bans, hoarding mandates, and panic buying at the national level turned the modest rice shortfall of 2008 into a global crisis, and analysts are already warning that import-dependent nations are the first dominoes.
The 2015-16 Super El Niño, a far weaker event than what is now forecast, threw tens of millions into food stress across Africa and Asia. This one is projected to be stronger, and it arrives with fertilizer already rationed by price and shipping lanes already contested by missiles.
What Joseph Knew
Scripture does not treat preparation for lean years as faithlessness. It treats it as wisdom delivered in advance to those willing to act on it.
Behold, there come seven years of great plenty throughout all the land of Egypt: And there shall arise after them seven years of famine; and all the plenty shall be forgotten in the land of Egypt.
Joseph did not respond to that warning with a hashtag or a committee. He stored grain during the years of abundance, and when the famine came, Egypt stood while its neighbors begged. The lesson is not that famine is certain. It is that the time to prepare is precisely when preparation still looks optional.
Nobody who filled a pantry in a year of plenty has ever regretted it, and nobody standing in an empty aisle has ever been glad he waited for certainty.
None of this calls for panic, and panic is the enemy of sound judgment anyway. It calls for the same unglamorous prudence our grandparents considered ordinary. Keep some cash margin, know your local growers, and put real food in deep storage while it is cheap and available, because the entire arc of this story is that cheap and available is a closing window.
Families looking for a straightforward place to start can visit Heaven’s Harvest and use promo code Patriot for 15 percent off long-term storable food. The forecasts may yet soften, the strait may yet reopen, and we should pray they do. But hope is a fine thing to hold and a foolish thing to eat.
