The Producer Price Index (IPP) changed -0.13% em January, em relation a December, and stayed below the change seen between November and December (0.59%). As a result, the cumulative rate of the last 12 months went to 2.85%, below the 4.46% seen in the same indicator for December.

IPP measures the evolution of “factory gate” prices,
discounted taxes and freight, of 23 sectors of the manufacturing industry. The complete publication can be accessed at https://www.ibge.gov.br/english/estatistica/indicadores/precos/ipp/default.shtm.

In January/15, the prices of the Manufacturing Industries changed, on average, -0.13% when compared to December/14 - a lower figure than the one seen in the comparison between December/ 14 and November/ 14 (0.59%).

In January/15 M/M-1, 16 of the 23 activities registered positive price changes, against 18 in the previous month.

The four major changes observed in January occurred in the products of the following industrial activities: tobacco (2.57%), other chemicals (-2.30%), manufacture of wearing apparel and accessories (-2.23%) and printing (1.76%).

Comparing January 2015 with January 2014 (M/M-12), the price change was of 2.85%, against 4.46% in December. The four major price changes came from beverages (9.90%), other transportation equipment (9.48%), leather articles and footwear (8.45%) and tobacco (8.44%).

The main influences for the M/M-12 indicator in January came from motor vehicles (0.77 p.p.), basic metals (0.46 p.p.), food products (0.39 p.p.) and other chemicals (-0.31 p.p.).

Next, five sectors are analyzed in details. In January, they were among the main highlights at least according to one of the following criteria: highest price changes or greatest influence, both in the comparisons: M/M-1 and M/M-12. Their main weightings are also presented.

Food products: in January 2015, the sector's price had a negative change, in relation to December 2014, of 0.52%, the first negative result since July 2014 (-1.21%). January's result, on its turn, is 1.99% higher than that of January 2014; however, in this type of comparison, in January, it is the lowest result of the series - replacing the rate of 2.18% of January 2012.

In terms of influence, out of the four products that stood out ('fresh or chilled beef', 'residue of soybean extraction', 'concentrated orange juice' and 'frozen beef') just one ('concentrated orange juice') presented a positive change of prices. The four products exerted influence of -0.79 p.p., in the -0.52% rate.

In the case of the changes in the four highlighted products (just 'fresh or chilled beef' appears in both lists), two had negative price changes (besides beef, there is also 'cocoa butter') and two ('cured beef or pork and related products, associated to slaughtering' and 'cured beef or pork and related products, not associated to slaughtering') had positive ones.

Among the products of highest influence, the price fall was associated to the crops (soybeans and beef). Conversely, orange juice reflected the seasonal price rise of the fruit itself.

Petroleum refining and ethanol products: in the comparison with December 2014, January's prices changed -1.43%. This is the second major negative change of the series (the first was – 2.08%, in May 2011) and it is also the second occurrence of a negative rate in the month of January (the other one was in 2012, -0.58%). In the comparison M/M-12, the result was 0.72%, the lowest result in this kind of comparison in the series initiated in December 2010 (4.34% in January 2011; 3.22% in January 2012; 7.21% in 2013; and 11.68% in 2014).

In terms of highlights in changes and influences, two products ('aviation kerosene' and 'naphthas'), both with negative price changes, appear in the two lists. The four products of highest influence (besides the ones already mentioned, 'ethyl alcohol (anhydrous or hydrated)' and 'diesel fuels and other fuel oils') influenced January's rate at -1.59 p.p. (- 1.43%), but just alcohol had a positive price change.

In the case of alcohol, the price rise seen was influenced by the expectations towards a rise in the ethanol demand caused by gasoline taxation, and especially in the case of the Northeast, due to the upcoming intercrop period. In the case of petroleum derivatives, they are usually in line with the international market, especially in the case of 'naphtha'.

Other chemicals: the chemical industry recorded this first month of 2015 a negative price change of 2.30%; the highest negative change of all economic sectors of the survey and the highest price reduction since July 2012 (-2.61%). So, the sector accumulated in the last 12 months a price change of -2.82%, the lowest value since the beginning of the series.

The scenario of the chemical industry of basic and intermediate petrochemical products for plasticizers, resins and fibers (classes 2021 and 2022 of CNAE - National Classification of Economic Activities) is very influenced by the prices of naphtha (input of products, such as high density polyethylene, polypropylene and styrene), which had a significant price decline in the last 12 months.

On the other hand, in the case of inorganic chemical products, the pressures observed are high.

Basic metals: comparing the prices of the sector in January 2015 against December 2014, there was a positive change of 0.23%, representing the fifth positive change in the last six months. As a result, the sector accumulated in the last 12 months (M/M-12) a price change of 5.86%; far below the result of December 2014 which was 10.16% (influenced by the result of January 2014).

The highlight, both for price change and influence, in the month over month comparison (M/M-1), were the products of the group basic metals of non-ferrous material (“copper and copper alloy bars, profiles and rebars ” and “unwrought non-alloy aluminum”) and “seam steel pipes”, all with a negative price change, offsetting “carbon steel ingots, blocks, billets and plates”. These products together represented -0.04 p.p. of the total change of 0.23%.

In relation to the main influences in the M/M-12 analysis, all highlighted products presented positive results. They are: “unwrought non-alloy aluminum”, “stainless steel coil or sheet, including strips”, “carbon steel ingots, blocks, billets and plates” and ' unwrought alloy aluminum”.

The overall results of this sector were strongly influenced by the currency fluctuations in relation to the dollar (depreciation of real by 18.1% in the last semester of 2014 and of 10.5% in the last 12 months) which offset the downfall of the international prices of the non-ferrous metals, and by the amount spent with energy consumption for production.

Motor vehicles: the manufacturing of motor vehicles posted a change of 1.32% in the MoM index of January 2015. In this indicator, the highlights were 'gasoline, ethanol or biofuel passenger car, of any engine power' and 'tractor truck for trailers and semi-trailers', 'diesel truck with loading capacity above 5t' with positive changes, and 'parts and pieces for motor vehicles', with a negative change. Together, these products represented 1.24 of January's result.

Even though they are not among the four main influences in this indicator, the products 'injection pumps for motor vehicles', with negative change, and 'air, oil or fuel filter for motor vehicles' and 'wheels for motor vehicles' with positive changes are the other highlights in terms of price changes, in the M/M-1 comparison.

In relation to the last 12 months (M/M-12), the index of the activity stayed at 7.08%. The products with the greatest influence in this indicator 'gasoline, ethanol or biofuel passenger cars, of any engine power', 'engine pieces for motor vehicles', 'diesel trucks with load capacity above 5t' and 'tractor trucks for trailers and semi-trailers' , all of them with positive changes.

Considering M/M-12, the change highlights were 'windshield cleaners', 'starter for internal combustion engines' and 'wheels for motor vehicles', all with a positive price change.