Producer Price Index
Industry prices grow 0.45% in September and record the second high in a row
November 05, 2019 09h00 AM | Last Updated: November 05, 2019 10h44 AM
The increase in diesel, gasoline and fuel oil prices drove the industry inflation to rise 0.45% in September, compared to August. The 1.06% increase in food also contributed to keep the sector's inflation at a positive level, since it is the activity with the largest weight in the index (23.31%).
These positive changes even outweighed the sharp drop of 10.49% in mining and quarrying prices. This is what the Producer Price Index (IPP), released today by the IBGE, reveals. The IPP measures the change in product prices at the "factory door", excluding taxes and freight, of 24 mining and manufacturing activities.
This is the second high in a row, after two consecutive declines in June (-1.13%) and July (-1.20%), and in August there was a 0.92% change. Year-to-date, prices rose 2.94% and, in 12 months, they fell 0.99%.
The oscillation of iron ore prices in the international market was the main influence on the fall in the prices of the mining and quarrying industry.
“China, Brazil's main buyer, is the country that sets iron ore prices. Besides the Chinese pricing policy, there is another explanation: the comparison basis against months of great highs,” said the IPP manager, Mr. Manuel Campos.
The food sector was influenced by the rising prices of soybean oil, beef and sugar, especially due to the depreciation of the real against the dollar. In the case of sugar, the lower supply explained the price rises, both because of the use of sugarcane for alcohol production and its delayed harvesting in the Northeast.
Other positive contributions came from oil refining and alcohol products, which grew 3.64%, after three consecutive months with negative monthly changes.
“In this sector, there was the influence of the increase in the price of crude oil”, comments Mr. Campos. Other chemical products, with a high of 0.97%, contributed due to the increase in the level of imports, added the research manager.
IPP's release in September is the first one with data for three-digit groups in the National Classification of Economic Activities (Cnae 2.0) in 23 new series, which will be available in the Table Database of the IBGE (Sidra) with results as of December 2018. This update stems from the expansion of the survey sample, which now covers 2,070 enterprises and 416 items, as announced in April.
Check out the video in which Mr. Manuel Campos talks about the news series and how those changes are important for the survey users.
