In March, the prices of the Overall Industry changed, on average, 0.09% in relation to February, above that reported in the comparison between February and January (-0.45%). The IPP registered a cumulative change of -0.05% in the year and of 2.85% in 12 months. Among the 24 activities surveyed, 17 posted positive price changes, against ten in the previous month. The Producer Price Index (IPP) measures the evolution of the prices of products 'at the factory gate', discounted taxes and freight.

The complete publication of the IPP can be accessed here.

Table 1
Producer Price Indexes, according to Mining and Manufacturing Industries (Overall Industry) and Sections - Last three months

Source: IBGE, Diretoria de Pesquisas, Coordenação de Indústria

In relation to February 2017, the prices of 17 out of the 24 activities increased in March 2017, against ten in the previous month. The four biggest changes were: mining and quarrying industries (3.44%), oil refining and ethanol products (-3.25%), manufacture of wearing apparel and accessories (2.96%) and printing (1.78%). The major influences came from oil refining and ethanol products (-0.34 p.p.); food products (-0.16p.p.), other chemicals(0.16 p.p.) and mining and quarrying industries (0.12 p.p.).

In March 2017, the cumulative index in the year hit -0.05%, against -0.14% in February 2017. The activities that recorded the highest changes in this indicator were: basic metals (7.15%), tobacco (-4.58%), non-metallic minerals     (-4.52%) and food products (-4.31%). The sectors that exerted the greatest influence were: food products (-0.92 p.p.), basic metals (0.53 p.p.), other chemicals (0.29 p.p.) and motor vehicles (0.09 p.p.).

The cumulative index in 12 months hit 2.85%, against 1.52% in February 2017. The four biggest price changes were reported in mining and quarrying industries (48.43%), basic metals (13.53%), printing (11.91%) and other transportation equipment (-10.41%). The sectors that mostly influenced were: mining and quarrying industries(1.23 p.p.), basic metals (0.97 p.p.), food products (0.76 p.p.) and other chemicals (-0.34 p.p.).

In March 2017, the price changes among the major economic categories (table) against February were: 0.80% in capital goods; 0.32% in intermediate goods; and -0.44% in consumer goods, being 0.37% in durable consumer goods and -0.69% in semi and non-durable consumer goods.

The influence of the major categories on the result of the industry (0.09%) was: 0.07 p.p. of capital goods, 0.18p.p. of intermediate goods and -0.16 p.p. of consumer goods. In the case of consumer goods, -0.19 p.p. were due to price changes registered in semi and non-durable consumer goods and 0.03 p.p. in durable consumer goods.

n the cumulative index in the year, the changes were: 0.34% due to capital goods (influencing
0.03 p.p.), 0.89% due to intermediate goods (0.50 p.p.) and -1.62% due to consumer goods (-0.58 p.p.). In this last case, the result was influenced by durable consumer goods (0.09 p.p.) and by semi and non-durable consumer goods (-0.67 p.p.).

In the cumulative index in 12 months, the changes were: capital goods, -1.04% (-0.09 p.p.); intermediate goods,3.91% (2.18 p.p.); and consumer goods, 2.14% (0.76 p.p.), being the influence of durable consumer goods of0.24 p.p. and that of semi and non-durable consumer goods, 0.52 p.p..

The sectors that stood out in terms of highest price changes or biggest influence in March 2017 in the three comparisons – monthly, cumulative in the year and cumulative in 12 months – can be found below.

Mining and quarrying industries: the prices of this sector changed, on average, 3.44% in March, which followed a change of -5.06% in February. The cumulative index in the year hit 0.22%, against -3.11% up to February. The change was of 48.43% compared with the same month a year ago. It is worth highlighting that this figure took into account the third lowest index-number in the time series: 56.29, in March 2016. In terms of influence, 'iron ores' positively impacted the indicator in the three comparisons – monthly, cumulative in the year and in 12 months –, whereas 'crude petroleum oil' negatively impacted both in the monthly index and in the cumulative in the year.

Food products: the prices of this sector changed -0.77% in March, recording the third retreat in a row. Including March, the cumulative change in the first quarter of the year was -4.31%. The negative figure in March was only surpassed by that of March 2013, -5.23%, in a time series whose cumulative index in March was positive in four years – 2010, 2012, 2015 and 2016 – and also negative in four years – 2011, 2013, 2014 and 2017. The result of the comparison between March 2017 and March 2016 was 3.76%. Concerning this indicator, the change was 11.72% between March 2016 and March 2015, and 8.79%, between December 2016 and December 2015.

Among the products that posted the highest price changes, two registered positive changes: 'yogurt' and 'cocoa candies and chocolates'. The former case unveiled a spread movement among the companies to raise the prices in March, which was repeating along the years. According to important companies, the prices of 'cocoa candies and chocolates' rose as a result of the foreign market, as well as of the Easter sales. Despite these two price increases, the other two products, both by-products of soybean, recorded negative price changes. These same products stood out among the four most influential, which added up to -0.71 p.p. in -0.77%. The four products were: 'refined soybean oil', 'refined sugarcane sugar', 'crystallized sugar' and 'crude degummed soybean oil'. 'Refined sugarcane sugar' was the only one whose prices changed positively, in line with the pre-harvest period of sugarcane. On the other hand, the soybean harvest explained the drop in its by-products and, in the case of 'crystallized sugar', the decreasing stock in many mills partly explained the movement.

Oil refining and ethanol products: the prices of this sector retreated 3.25%, on average, in March. The cumulative index was 0.80%. In the annual comparison, the change was 2.68%.

The four products that mostly influenced the monthly result impacted -3.28 p.p. in -3.25%. The most influential products where those that mostly contributed to the computation of the index: 'diesel fuel and other fuel oils', 'ethyl alcohol (anhydrous or hydrated)', 'motor gasoline' and 'naphtha'. The average change of all of them was negative in March.

Other chemicals: the chemical industry registered an average price change of 1.69% in March over February, resuming the recovery of prices started in September 2016 and interrupted only in February 2017. This process was not sufficient to reverse the negative result in the last 12 months (-3.39%), though it recorded the second biggest price rise in the year (3.15%).

The drop in the annual comparison was linked to the international prices and to the costs of the imported raw material, both of them influencing the 15.6% appreciation of the real in relation to the dollar in the last 12 months and the 6.7% appreciation just in the first three months of the year. The price movement of the petroleum derivatives also influenced, particularly the longer prize movements of naphtha, as well as the ammonia prices in the year.

The four products that mostly influenced the month-over-month index ('unsaturated propene (propylene)', 'polypropylene', 'styrene' and 'NPK-based manure and fertilizers') posted a positive figure of 1.18 p.p. in the 1.69% change in the month. In other words, the other 28 products positively contributed with 0.51 p.p.

Basic metals: the March 2017 over February 2017 comparison of the prices in this sector unveiled the continuation of the price rises registered since November 2016, reaching a positive average change in 1.40%. Concerning the cumulative results in the year, this activity changed 7.15% – the highest change among the activities of the survey – and recorded a positive cumulative change of 13.53% in the last 12 months, second only to mining and quarrying industries.

The highlights in the M/M-1 comparison, both in terms of change and influence, were: 'unwrought non-alloy aluminum' and 'carbon steel ingots, blocks, rods or plates', both with price rises, and 'stainless steel coil or sheet, including strips', this one with negative figures. Considering the change indicator only, the product 're-rolled steel' should be included.

In terms of influence, the four products that stood out in the month-over-month indicator accounted for 1.21 p.p. of 1.40%. This group comprised at least three products previously mentioned plus 'uncoated hot-rolled steel carbon coil'.

Motor vehicles: the change reported in March was of 0.07%, when compared with the immediately previous month. This was the eighth consecutive positive change of this activity, which had been showing positive figures in the M/M-1 indicator since August 2016. As a result, the cumulative change in the year reached 0.85%. This was the lowest cumulative result in the first three months of the year since 2013. By way of comparison, the cumulative index in March 2016 was 1.76%. This sector posted a cumulative change of 2.96% in the last 12 months.

Among the four products that mostly influenced the M/M-1 indicator, those that positively impacted the index were 'bus bodies' and 'flex-fuel, gasoline or ethanol passenger car with any engine power output', being the latter the product with the highest weight in this activity. The products that negatively impacted were 'gearbox for motor vehicles' and 'wipers'.

As to the M/M-12 indicator, the four products that mostly influenced this index were: 'flex-fuel, gasoline or ethanol passenger car with any engine power output', 'diesel truck with load capacity above 5t', 'chassis with engine for buses or for trucks' and 'diesel and semi-diesel engines for buses and trucks'.