In January of 2013, the Producer Price Index (IPP) changed -0.04% compared with the previous month; a lower result than that recorded in December (0.41%). When compared with the same month a year ago (cumulative in 12 months), prices changed 7.69% in January, against 7.28% in 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 www.ibge.gov.br/english/estatistica/indicadores/precos/ipp.

11 of the 23 activities surveyed registered a rise in prices

In January 2013, 11 of the 23 activities surveyed registered a rise in prices, against 17 in the previous month. The four highest changes, both positive and negative, observed in January in relation to December were registered among the products of the following industrial activities:  toiletries, soaps and cleaning preparations (-2.12%), optical, electronic and computer equipment (-1.99%), fabricated metal products (1.59%) and food (-1.56%).   

The sectors to exert the greatest influence in this comparison were food products (0.31 p.p.), motor vehicles (-0.13 p.p.), other chemical products (0.10 p.p.) and basic metals (-0.07 p.p.).

When compared with the same month of 2012 (cumulative in 12 months), prices rose 7.69%, against 7.28% in December. The four major price changes came from tobacco (22.21%), paper and pulp (14.06%), other chemical products (13.34%) and food products (13.17%). The major influences in the comparison of January against the same month a year ago came from food products (2.49 p.p.), other chemical products (1.42 p.p.); petroleum refining and alcohol products (0.80 p.p.) and paper and pulp (0.44 p.p.).

Food products: in January 2013, the price change in the food sector was 1.56% - first negative result since October 2012 (-1.44%). Even so, current prices are 13.17% higher than those of January 2012. In the January 2013 / December 2012 comparison, just the item “residues from soybean oil extraction” was a highlight both in terms of change and influence, due to the negative change of prices, attributable to the downturn in the soybean crops. In terms of influence, the products with a negative change are “crystallized sugar” (whose prices have been dropping since August 2012, except for November over October) and “husked, milled rice, parboiled or not” (whose harvest has created favorable conditions for the industry to buy raw-materials). The only positive influence was attributable to “wheat flour”, whose rise is due to the break in the global supply chain, specifically related to traditional producers (Ukraine and Russia). In the long run, the same products selected in the comparison with the previous month also come up as the most significant influences in the cumulative index over 12 months, however, in such case, they are under the influence of the movement occurred throughout 2012.

Paper and pulp: the activity of manufacture of paper and pulp recorded in January -0.28% in relation to December. Concerning the last 12 months (M/M-12 indicator), the activity changed 14.06%. In January 2013, the activity prices were 18.29% higher than those of December 2009 (the starting point of the series).

Petroleum refining and alcohol products:  in January 2013, the activity recorded an increase of 0.17% in relation to December, keeping the upward trend recorded since March 2012. In the cumulative index over 12 months, January records 7.23%.

Other chemical products: the chemical industry registered in January an increase of 0.91% in relation to December 2012, following the previous month’s trend, which recorded 0.42% against November. In the comparison between January 2013/January 2012, the sector presented an increase of 13.34%.

Basic metals: in January 2013, the activity presented , for the third month in a row, a positive change if compared to the preceding month (0.94%). This was the highest rise since May 2012. Three out of the four products that most influenced January's result this year against January last year are classified as "Metallurgy of non-ferrous metals”, very much dependent on international prices, LME quotations and on the 13.5% valuation of the dollar in the period. They are: “unwrought non-alloy aluminum", "copper bars, rods and profiles and copper alloys" and "unwrought aluminum alloys." The only product in the steel mill sector that stands out is "hot-rolled steel carbon coils, uncoated”

Optical, electronic and computer equipment:  the activity recorded -0.99% in January 2013 over December 2012, keeping the downward trend seen since August (-0.19%). In the January 2013/ January 2012 comparison, there was a 0.42% change.

Motor vehicles: in January 2013, the prices of the activity presented a positive change of 1.12% in the comparison with the previous month, against a positive change of 0.26% in December 2012. In the comparison with January 2012, the activity posted a positive change of 2.18% in January 2013, returning to the standards seen until September 2012.