Industrial production in Serbia recorded a sharp decline at the start of 2026, signaling a difficult opening month for the country’s manufacturing and energy sectors. According to data released by the Statistical Office of the Republic of Serbia, total industrial output in January 2026 was 9.1% lower than in January 2025, while production was 14.4% below the average level recorded in 2025.
The contraction affected all three major industrial segments. Manufacturing output dropped by 12.4%, mining declined by 2.3%, and electricity, gas and steam supply decreased by 0.8% compared with the same month a year earlier.
A key factor behind the decline was a temporary disruption in the oil processing sector. The Pančevo refinery, operated by NIS, experienced operational interruptions after the company came under pressure from U.S. sanctions, delaying crude oil deliveries and reducing refinery throughput during the first half of January. As a result, production of coke and petroleum products collapsed by 73.3% year-on-year, making it the single largest negative contributor to the monthly industrial output figures.
The downturn was not limited to the energy segment. Across the manufacturing sector, 15 out of 23 industrial branches recorded year-on-year declines, indicating that the slowdown was relatively broad-based. Among the most significant contractions were:
- Production of computers, electronic and optical products, down 38%
- Chemical industry output, down 28%
- Manufacturing of other transport equipment, down 60%
Despite the overall negative trend, some sectors showed notable resilience. Automotive manufacturing stood out as the main positive contributor, with motor vehicle production increasing by 58% compared with January 2025, partially offsetting declines in other manufacturing segments.
When industrial production is examined by end-use categories, the January data reveal the strongest contraction in energy-related output. Production of energy goods fell by 21.1% year-on-year, reflecting weaker electricity generation and refinery disruptions. Production of durable consumer goods dropped by 14.9%, while non-durable consumer goods declined by 8%. Output of intermediate goods (excluding energy) decreased by 3.4%, pointing to slower activity in upstream industrial supply chains.
The only major category showing growth was investment-related output. Production of capital goods increased by 8.6%, suggesting that investment demand—particularly related to machinery and equipment—remained relatively stable despite the broader industrial slowdown.
Month-to-month data offer a slightly more optimistic signal. Seasonally adjusted indicators show that industrial production increased by 1.6% in January compared with December 2025, while manufacturing output alone grew 3.0% month-on-month, indicating that part of the annual decline may reflect temporary disruptions rather than a structural contraction.
The January figures arrive after mixed industrial performance during 2025. Earlier in the year the sector showed occasional growth spurts, but by the end of 2025 the trend had already begun to weaken. For example, industrial output in November 2025 was already 3.4% lower than in November 2024, highlighting the gradual deceleration that preceded the sharp start to 2026.
Taken together, the January data suggest that Serbia’s industrial sector entered 2026 under pressure from a combination of energy-sector disruptions, weaker manufacturing output in several key branches, and external factors affecting refining operations. Whether the downturn proves temporary will depend on the normalization of refinery activity, recovery in export-oriented manufacturing, and broader trends in European industrial demand during the coming months.
