The Producer Price Index (IPP) changed 0.85% in October, less than September (1.23%). When compared with the same month a year ago (accumulated in 12 months), the prices changed 4.77% in October and 4.91% in September. Conversely, the accumulated change in 2011 was of 2.86% in October and 1.99% in September.

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

17 of the 23 activities registered highs in the prices

Seventeen of the 23 activities recorded positive changes in the prices in October 2011, the same number as in the previous month.

The four largest price changes in October, compared with September, were observed in products within the following industrial activities: beverages (3.62 %); fabricated metal products (3.46%); other chemical products (2.74%); and pulp and paper (-2.12%). The most influential items were other chemical products (0.30 p.p.); food products (0.16 p.p.); motor vehicles (0.11 p.p.); and fabricated metal products (0.10 p.p.).

The indicator accumulated in the year (October 2011 against December 2010) reached 2.86%, compared with 1.99% in September 2011. Among the activities that recorded the highest percentage changes as to the accumulated indicator in October 2011, the highlights were: footwear and leather (14.70%); computer equipment, electronic and optical products (-11.15%); other chemical products (10.28%); and rubber and plastic products (8.63%). The sectors that mostly influenced this indicator were: other chemical products (1.05 p.p.); food products (0.72 p.p.); petroleum refinement and alcohol production (0.49 p.p.); and computer equipment, electronic and optical products (-0.40 p.p.).

Comparing October 2011 with October 2010 (accumulated in 12 months), the price change was of 4.77%, comparing with 4.91% in September. The four major price changes were observed in footwear and leather (16.64%); other chemical products (13.84%); beverages (11.71%); and computer equipment, electronic and optical products (-11.67%). The major influences on this indicator came from food products (1.85 p.p.); other chemical products (1.40 p.p.); petroleum refinement and alcohol production (0.71 p.p.); and computer equipment, electronic and optical products (-0.43 p.p.).

The food prices rose by 0.85% in October when compared with September.

This change in October is the smallest of the positive changes observed since July 2011. The prices in this sector accumulated 3.82% along the year until October. The change was of 10.29% in relation to the same period last year. Compared with September, the four products with the highest influence on the result added up to 0.95 p.p. (of 0.85%). Except by pork sausages or salami, integrated to slaughtering, which rose significantly but with no influence on the indicator - residues from soybean oil extraction appears in its place with a negative influence -, the other products either change or influence positively. The raise observed in meat products is in line with the raise of the prices of cattle for slaughtering in the period, whereas the case of concentrated orange juice is better explained by the increase of the prices in the international market. The prices of this sector accumulated until October changed 3.82% against 2.95% accumulated until September. The scenario is different from the same month last year, when this sector had accumulated an increase of 14.12% by October. The products that changed significantly the prices are not the same as those that influenced this indicator. It is important to notice that cacao butter (change) and residues from soybean oil extraction (influence) appear due to negative changes, among products with significant positive changes in the accumulated of the year. A change of 10.29% has also been noticed when compared with the same month last year, the smallest in the series started in December 2010. The products that changed significantly are not the same as those that mostly influenced this indicator. The products that mostly influenced were concentrated orange juice; crystallized sugar; frozen beef; and refined soybean oil.

The change of the prices of footwear and leather in this month, compared with the previous month, was virtually null (0.00%), thus repeating in October the same value accumulated until September (14.70%).

However, the prices in October 2011 changed 16.64% compared with October 2010.

The sector of petroleum refinement and alcohol products recorded a positive change of 0.79% in October, compared with September 2011, increasing the change of 0.19% recorded in September compared with August. The indicator of September continued the upward trend in the index accumulated along the year, recording 4.57% between January and October. It has been the largest accumulated value since April 2011, when the index of the year hit 6.13%. In the last 12 months, the change from October 2010 until October 2011 was of 6.53%, against 6.30% from September 2010 until September 2011. Considering the monthly influence of the major products of this sector, the four highlights came from the petroleum refinement sector: naphtha; automotive gasoline; aviation kerosene; and diesel fuel and other fuels. These four products added up to 0.71 p.p. of 0.79% recorded in October, compared with September. It is worth to mention that automotive gasoline was the only of the four products that negatively influenced this same indicator. From the four highlights, three of them – naphtha; aviation kerosene; and ethyl alcohol – positively influenced the overall index of the sector, either in the accumulated indicator of the year or in the last 12 months. On the other hand, automotive gasoline recorded a negative influence when considering the accumulated indicator of the year. When comparing October 2011 with October 2010, basic lubricants positively influenced the indicator of this sector.

The manufacturing of other chemical products raised the price level by 2.74% in October, when compared with September 2011. This represents the second consecutive month of price increase – 2.46% recorded in the last month – after negative changes of 2.00% in August and 2.09% in July. This sector accumulated an increase of 10.28% in the year, the second largest of all the 23 sectors surveyed, as well as an increase of 13.84%, when comparing October 2011 with October 2010. From the four products that mostly influenced the comparison with September in this sector, two of them are from the petrochemical industry: non-saturated ethylene (ethane), which shows an ascending movement, and non-saturated propane (propylene), which shows a negative change. NPK-based manure or fertilizers were also positive highlights. Ammonia is the other highlight of the index in October, compared with September, also with a positive change. As a whole, the four products together add up to 1.45 p.p. of the 2.74% index of this sector. For the remaining indicators, the increase of the prices of petroleum related products at the end of 2010 and beginning of 2011 sustains the prices of propane and polypropylene, highlights in the accumulated of the year and in the October 2011/October 2010 comparison, as well as of NPK-based manure and fertilizers, all of them influencing positively. Conversely, while styrene-butadiene rubber highlights positively in the accumulated of the year, urea is the highlight in the October 2011/October 2010 indicator.

The prices of the activities related to the manufacturing of rubber and plastic recorded a positive change of 0.09% in October 2011, compared with the previous month. In the accumulated index of the year, the change was of 8.63%, higher than in the previous month (8.54%). In the accumulated indicator in 12 months, the sector recorded a rise of 8.33%, below the rate observed in September (8.61%). When comparing with September, the four major products that influenced the indicator - plastic articles for domestic use; bottles and packages made of plastic material, including PET; new tires for automobiles and SUVs; and new tires for trucks and buses – add up to 0.05 p.p. of 0.09%.

The prices of the products of the sector metal products increased 3.46% in October, the largest positive change in the series. Hence the accumulated changes in the year moved from -6.47% (September) to -3.24% (October). Comparing with October 2010, the prices in October 2011 recorded a negative change of 1.74%. From the four largest changes in prices in relation to September, only the product containers for transportation and storage of gas showed a negative change, though it was not one of the major influences. In any case, the four largest influences added up to 3.41 p.p. of the 3.46% price change. It should be mentioned that the highlight was aluminum can for packaging: this product shows the highest weight in the index and faces a rise in the prices with the coming summer.

Computer equipment, electronic and optical products

recorded a change in prices of 0.47% in October in relation to September, the first positive change since March. This activity recorded a negative change of 11.15% in the indicator accumulated along the year. Considering the last 12 months, the indicator accumulated a negative change of 11.67%. Printers, including multi-function; televisions; and recorders or players of audio and video signals showed positive changes in this month, whereas desktop PCs showed a negative change. In terms of influence in relation to September, the four highlights televisions; desktop PCs; printers, including multi-function; and radio receivers for any use, even combined with other devices added up to 0.37 p.p. of the index of 0.47%. 

The prices of the manufacturing of motor vehicles recorded a positive change of 0.97% in October 2011, when compared with September. In the accumulated index of the year, the change was of 1.84%, higher than in the previous month (0.86%). This sector recorded a positive change of 1.48% in the indicator accumulated in 12 months. The change of the prices in October was the largest in the series, making this sector one of the four highest influences on the indicator for the overall manufacturing industry, adding up to 0.11 p.p. of 0.85%. Passenger automobiles, gasoline, alcohol or bi-fueled, of any power; gear boxes for motor vehicles; motor parts for motor vehicles; and cargo vehicles, gasoline or alcohol fueled, less than 5t of capacity were the products that mostly influenced the M/M-1 indicator, adding up to 0.94 p.p. of 0.97%. All but gear boxes for motor vehicles showed positive changes in the prices.