Output rises in January amid sustained increase in new orders

WELSH firms returned to growth in January, with business confidence climbing to its highest level in 16 months, according to the latest Cymru Growth Tracker from NatWest.

The Wales Business Activity Index — a seasonally adjusted measure of month-on-month changes across manufacturing and services — rose to 50.3 in January, up from 49.4 in December. Any reading above 50 signals growth, ending a four-month run of contraction for the Welsh private sector.

The improvement was supported by a continued rise in new orders, although the pace of expansion eased and remained only modest overall.

Business optimism strengthened for the third consecutive month, reaching its highest point since September 2024. Firms said they were hopeful that increased investment would help drive growth throughout 2026, despite ongoing concerns about the impact of higher prices on customer demand.

However, inflationary pressures remained elevated. Input costs rose at the joint-fastest pace since last August, matching December’s four-month high and remaining historically strong. Of the 12 UK regions monitored, only Northern Ireland recorded a sharper increase in cost pressures.

Welsh companies raised their selling prices for the second month in a row in an effort to pass on higher costs. The rate of price increases was the steepest since May 2025 and broadly in line with the UK average.

Despite the return to growth, staffing levels continued to fall. Workforce numbers declined at the fastest rate since December 2024 — the steepest reduction of any UK region — as firms cited financial pressures and cost control measures.

Backlogs of work fell at a marked pace, faster than in December, suggesting businesses were able to work through outstanding orders as output improved.

Jessica Shipman, Chair of the NatWest Cymru Board, said Welsh businesses were showing “growing optimism about future output”, but warned that cost pressures remained significant and were contributing to job losses.

Although activity returned to growth, the rate of expansion in Wales remained well below the UK average, and confidence levels were slightly weaker than the national trend.

PLANS for new livestock buildings at a Pembrokeshire dairy farm, aimed at “improved animal husbandry” will not lead to an increase in herd size, councillors heard.

In an application recommended for approval at the February meeting of Pembrokeshire County Council’s planning committee, Mr Roblin of Clynderwen Farm, Clunderwen, sought permission for two livestock building at the 210-hectare dairy farm of 280 cows and 235 head of young stock.

A report for members said each livestock accommodation building would have a length of 77 m, a width of 33m, an eaves height of 3.6m and a ridge height of 8.9m.

Both buildings would be parallel to each other and would cover a footprint of 5,082sqm (2,541sqm each). The proposal includes a total of 308 cubicles, loafing and feed areas, with a central feed passage in the middle.

It said the buildings at the site, some 200 metres from the nearby Redhill school and just over a kilometre from Clunderwen, would sit a little lower than those already on site, and the proposals would not lead to any increase in herd size.

Speaking at the meeting, agent Gethin Beynon said the scheme would lead to “improved animal husbandry to serve the existing milking herd and to support the next farming generation”.

He told members the application was accompanied by environmental enhancements and screening, with no objections from members of the public or any statutory bodies.

Mr Beynon went on to say the herd was currently housed in historic farm site buildings that “fall short of current standards,” with a farm move towards Holstein cattle which need more space.

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“It will improve animal husbandry and efficiencies in what is currently a challenging market,” he concluded.

Approval was moved by Cllr Alan Dennison, seconded by Cllr Brian Hall, and unanimously backed by committee members.

PLANS for an InPost e-commerce parcel locker service at a Pembrokeshire seaside village have been given the go-ahead by the national park despite concerns about its impact on neighbouring properties.

In an application to Pembrokeshire Coast National Park, InPost UK, through agent Skipton-based NL Jones Planning, sought permission for an InPost Parcel Locker at Bay View Stores, Maes Ewan, Solva.

InPost is a parcel locker service throughout the UK where you can send and return parcels quickly with contact-free delivery.

A supporting statement says e-commerce now accounts for 30 per cent of all retail UK sales, but “while this growth brings consumer convenience, the final leg of delivery – known as the ‘last-mile’ – is putting pressure on our streets and wallets, if all deliveries continue to be delivered to door,” with both more delivery vehicles on the road and “home deliveries more inconvenient and missed parcels more common” as more people return to the office post-Covid.

It added: “This service offers substantial new business opportunities often for local small and medium businesses, such as Etsy sellers, offering a more convenient, efficient and cost-effective alternative to traditional services.”

It says the service also benefits small local businesses such as convenience stores through increased footfall, adding: “In exchange for hosting a locker, InPost pays landlords guaranteed rent, transforming unused spaces to become a popular in-demand community asset that also provides a new additional income stream.”

An officer report recommending approval said: “The principle of development is considered acceptable, and the proposal is not considered to result in unacceptable harm to the special qualities of the Pembrokeshire Coast National Park.”

It said there were two letters of concern from members of the public raising issues including “potential noise and disturbance arising from use of the locker outside shop opening hours, including late night and early morning activity, vehicle movements and locker door noise,” increased parking demands, the effect of any CCTV systems on neighbours, and concerns it would be visually harmful “within the village street scene”.

The report concluded: “It is acknowledged that Solva is a relatively quiet village setting outside of peak daytime periods, and that noise can carry. However, the proposed parcel locker is to be located within the curtilage of an established convenience store where there is already regular customer activity, vehicle movements and servicing/delivery activity.

“The proposal is not considered to introduce a materially different form of activity to that already associated with the lawful retail use of the premises. In addition, the parcel locker itself is a passive facility and would not generate continuous noise.

“Any noise associated with its use would be intermittent and comparable to typical short-duration activity associated with customers visiting the shop.”