In August of 2011, the Producer Price Index (IPP) changed 0.20% compared with the previous month; a higher result when compared with the one of July (0.03%).

When compared with the same month a year ago (accumulated in 12 months), prices changed 4.28% in August and 4.83% in July. Conversely, the accumulated change in 2011 was of 0.79% in August and of 0.59% in the previous month.

The IPP measures the evolution of "factory gate prices", discounted taxes and freight, of twenty-three sectors of the manufacturing industry. The complete publication can be accessed at www.ibge.gov.br/english/estatistica/indicadores/precos/ipp.

Eleven of the twenty-three activities surveyed registered a high in prices

 In August of 2011, eleven of the twenty-three activities surveyed registered a high in prices, against ten in the previous month. The four major changes of August in relation to July came from food products (3.64%), toiletries, soaps and cleaning preparations (3.09%), basic metals (-2.17%) and textiles (-2.02%). The items to exert the greatest influence, or impact, on the change of August against July (0.20%) were food products (0.66 percentage points), other chemical products (-0.22 p.p.), basic metals (-0.18 p.p.) and textiles (-0.05 p.p.). 

The accumulated indicator of 2011 reached 0.79% in August against 0.59% in July. Among the activities that registered the highest percentage changes as to the accumulated indicator, the highlights were footwear and leather (10.75%), computer, electronic and optical products (-10.39%); rubber and plastic (8.54%) and fabricated metal products (-6.90%). The sectors to exert the greatest influence were other chemical products (0.49 p.p.), petroleum refinement and alcohol products (0.38 p.p.), computer, electronic and optical products (-0.38 p.p.) and rubber and plastic (0.30 p.p.).

 When compared with the same month of 2010 (accumulated in 12 months),

prices rose 4.28% in August, against 4.83% in July. The four major price changes came from textiles (16.11%), food products (15.99%), computer, electronic and optical products (-14.50%) and footwear and leather (12.35%). The major influences in the comparison of August against the same month a year ago came from food products (2.68 p.p.), other chemical products (1.13 p.p.), petroleum refinement and alcohol products (0.71 p.p.) and computer, electronic and optical products (-0.57 p.p.).

In August, the prices of food products changed by 3.64% in relation to July.

The major four influences in this indicator account for 2.17 pp of this rate, all of them attributable to the positive price changes. Among these products, it is worth mentioning the presence of crystallized sugar (a highlight in influence) and refined sugarcane (change and influence). After five consecutive negative price changes, the rate of August is the second consecutive positive change. As a result, the accumulated index in 2011 is positive again (0.09%), what did not occur since February. In the indicator accumulated in 12 months, the prices of August of 2011 are, on average, 15.99% higher than the ones of August of 2010, a number above that observed in July (15.20%). The four major influences on this indicator account for 8.25 p.p., and are attributable to the two types of sugar aforementioned, rude soybean oil, including the degummed one, and concentrated orange juice. It is important to mention that in August the positive price change in food products had a relevant influence on the comparisons with the previous month and with August of 2010, but not on the accumulated indicator in 2011. That shows, on one hand, a more abrupt movement in August and, on the other hand, the high level the sector maintains in comparison with the same month a year ago, despite the negative changes from February to June.

Textiles

presented a negative change (2.02%) in August, keeping the trend recorded in the last four months, which accumulated a negative change of 6.05%. The sector accumulated in 2011 a high of 4.67% (6.83% in July), the same scenario applying to the comparison with August of 2010, of which change continues positive at 16.11% (19.79% in July). The products that, compared with the previous month, presented a higher percentage change, all negative, were: multiple (folded) or cabled cotton yarn; single cotton yarn; cushions, pillows and the like; and dyed or printed cotton fabrics, except of yarns of different colors. In the indicators accumulated in 2011 and in 12 months, cotton products (particularly fabrics) kept positive influence and change, due to the price increase of cotton mainly observed up to the beginning of 2011.

The negative change of 0.28% in petroleum refinement and alcohol products in August led to a contraction of the accumulated indicator of 2011 (3.55%), slightly lower than the rate of June (3.59%).

In the last four months, the prices of the products of this sector accumulated a negative change of 2.43% against a positive change of 6.13% in April. The three relevant products in the negative price change in the monthly comparison were also among the most influential: naphthas, ethyl alcohol (anhydrous or hydrated) and aviation kerosene. The prices of the sector were 6.50% bigger than the ones in August of 2010. Naphthas and ethyl alcohol (anhydrous or hydrated), aviation kerosene and basic lubricant oils were highlights in this indicator, accounting for 6.47 pp of the change.

Other Chemical Products

recorded a negative change of 2.00% in relation to the prices of July this year, repeating the trend of last month (-2.09%). The sector accumulates in the year a high of 4.76%. In August a year ago, the sector accumulated a change of 8.87%. In the comparison with August of 2010, the change stayed at 11.38%. Some products of the petrochemical industry – unsaturated ethylene (ethane) and unsaturated propane (propylene), styrene and PVC – are still influenced by the drop in international prices. Conversely, the manufacture of intermediate goods for fertilizers recorded a high, attributable to the price increase of the food sector. In general, the major four products of this sector accounted for –2.10 pp of the monthly change (-2.00%). In the accumulated indicators of the year and in 12 months, the products related to the petroleum chain sustained the prices of styrene-butadiene rubber and unsaturated propane (propylene). In the highs of 2011, the highlights were titanium dioxide and superphosphates (manure) and, in the accumulated indicator in 12 months, ammonium and ammonium sulphate or urea.

In August of 2011, the prices of rubber and plastic recorded a positive change of 0.43%.

The accumulated change in 2011 was of 8.54%. All monthly changes were positive in the period, with an average increase of 1.03% per month. In the accumulated indicator in 12 months, the sector recorded a high of 7.93%, below the rate in July for the same period (8.17%). The negative influence of new tires for automobiles and SUVs on the monthly change stands out. New tires for motorcycles presented a positive price change in all comparisons.

Basic metals

recorded a price drop of 2.17% in August over July (the third consecutive negative change), mainly due to imports, excess of iron in the international market and high stocks. The activity recorded a drop of 2.19% in the accumulated indicator in 2011, particularly, the change was of -4.22% in the last three months. In the last 12 months, the indicator accumulated –5.55%. The four products to exert the major influence and change considering the monthly indicator are from the iron chain. Particularly, steel carbon ingots, blocks, rods or plates, cold-rolled steel coil and uncoated thick steel carbon plates are highlights both in the monthly change and in the influence on the month. Concerning the accumulated index of the year, only one of the four products with the largest changes recorded a positive change (wire and carbon steel wire). As for the accumulated indicator of 12 months, among the four major changes only one product registered positive rates (aluminum plates and strips of rectangular or square shape, which do not belong to the sector of siderurgy). In terms of influence, another aluminum product stood out, the unwrought not alloyed aluminum, with positive influence in the month/month a year ago comparison.

Computer, electronic and optical products

recorded a negative change of 0.84% in August, sharpening the change of the previous month (-0.22% in July). The sector accumulates a drop of 10.39% (-9.63% in July) in the year and a negative change of 14.50% in the last 12 months (-14.87% in July). The products that presented higher changes compared with July of 2011 were: televisions (negative); image tubes for television receivers and video monitors (positive); cell phones (negative); and radio receivers for any purpose, including the ones combined with other apparatus (positive). Those products exerted the greatest influence on the indicators of the sector and, altogether, accounted for –0.91 pp. As the "real" is appreciating, the pressures on this sector, particularly via imports, continued.

In August of 2011, the prices of motor vehicles recorded a positive change of 0.22% compared with the previous month. In the accumulated index of the year, the change was of 0.69%, higher than the one registered in the previous month (0.47%).

In the comparison with August of 2010, the sector recorded a negative change of 0.08%, higher than that of July (-0.46%). In the accumulated index of 2011, the activity has recovered prices since April. That recovery virtually neutralized the price loss in the accumulated index in 12 months. Motor vehicles for the transport of persons, powered by gasoline, alcohol or biofuel, of any capacity, are a relevant product for the estimate of the index of the sector. It finished August with stable prices, but continues the downward trend in the accumulated index of the year and in 12 months.