UK manufacturers' forecasts of strong growth in output volumes have failed to materialise, a survey has revealed.

The Confederation of British Industry's survey of more than 400 manufacturers, conducted between May 22 and June 12 and published yesterday, showed output volumes were broadly flat over the latest three months.

Of firms surveyed, 26% reported a rise in output and 24% experienced a fall.

This outturn contrasts with forecasts in the March, April and May CBI industrial trends surveys of strong growth in output volumes on a three-month view.

In spite of the continuing disappointment for UK manufacturers on the output front, 27% predicted a rise in volumes in the coming three months and only 17% projected a decline, with the remainder anticipating an unchanged position.

However, this net 10% projecting a rise in output on a three-month view is weaker than respective corresponding balances of 22%, 23%, and 18% in the CBI's March, April, and May surveys.

The June survey points to continuing weakness in UK manufacturers' export order books, with only 11% reporting these were above normal levels and 33% viewing them as worse than usual.

The net 22% of manufacturers reporting below-normal export order books was the worst such reading since January, and marked a deterioration from a corresponding balance of 17% in last month's survey.

According to the CBI survey, small and medium-sized firms are struggling most with export orders.

Only 14% of UK manufacturers said overall order books were above normal, with 32% considering them worse than usual.

The CBI noted the resultant net 18% reporting below-normal order books was in line with the 17% long-run survey average.

Stephen Gifford, CBI director of economics, said: "Manufacturers are treading water with domestic and export orders stagnant. Production levels remain flat, but firms predict a modest pick-up over the coming three months. "While an expected improvement in conditions at home and abroad should lead to better prospects for manufacturers, the business climate still remains quite fragile."