In March of 2012, the Producer Price Index (IPP) changed 1.05% compared with the previous month...

In March of 2012, the Producer Price Index (IPP) changed 1.05% compared with the previous month; a higher result than the one achieved in February (-0.42%).  This rate is the second highest since December 2010 (in September 2011 it was 1.23%). Contrasting the current month with the same month a year ago (accumulated in 12 months), prices changed 1.37% in March and 0.71% in February. Conversely, the accumulated change in 2012 was of 0.19% in March and of -0.85% 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.

18 of the 23 activities surveyed registered a rise in prices

In March 2011, eighteen of the twenty-three activities surveyed registered a rise in prices, against nine in the previous month. The four major changes of March in relation to February came from optical, electronic and computer equipment (4.70%), tobacco (4.28%), paper and pulp (3.82%) and other transportation equipment (2.56%).  The sectors that exerted the greatest influence in this comparison were food products (0.30 p.p.), other chemical products (0.16 p.p.), optical, electronic and computer equipment (0.15 p.p.) and paper and pulp (0.12 p.p.).

The accumulated indicator of 2012 reached 0.19% in March, against -0.85% in February.  Among the activities that registered the highest percentage changes as to the accumulated indicator, the highlights were optical, electronic and computer equipment (6.11%), paper and pulp (3.07%), apparel and accessories (2.56%) and machines and equipment (2.41%). The sectors with the greatest influence were optical, electronic and computer equipment (0.19 p.p.), other chemical products (-0.17 p.p.); machines and equipment (0.11 p.p.) and paper and pulp (0.10 p.p.).

When compared with the same month of 2011 (accumulated in 12 months), prices rose 1.37% in March, against 0.71% in February. The four major price changes came from footwear and leather (16.40%); beverages (8.86%), textiles (-7.07%) and tobacco (6.43%). The major influences in the comparison of March against the same month a year ago came from food products (0.64 p.p.); motor vehicles (0.28 p.p.); footwear and leather (0.25 p.p.) and beverages (0.23 p.p.).

Food products: with a 1.59% change, in the comparison with March 2012 against February 2012, the sector of food products, for the first time in the year, presented a positive rate in this perspective and also in the accumulated one (0.06%) Constrating with March 2011, the prices of March 2012 were 3.45% higher, the biggest rate in this kind of comparison since December 2011.

Apparel and accessories: the sector of apparel and accessories, for the second consecutive month, recorded a rise in the prices (2.02% in March and 2.14% February), which is attributable at a great extent to the launching of new collections.  The results of the indicators accumulated in the year and accumulated in twelve months were 2.56% and 3.97%, respectively.

Footwear and leather: in March 2012, the prices of footwear and leather products had a positive change of 1.71% when compared with February, the highest rate since October 2011 (7.08%). As a result, the sector accumulated a positive change of 2.10% in the year.  In the accumulated of twelve months, the prices were 16.40% higher.

Paper and pulp: in relation to February 2012, the sector recorded a positive change of prices of 3.82%, the greatest result since January 2010. In the accumulated of the year, the change was of 3.07%. In the accumulated of twelve months, there was a decrease in the index, which stood at -1.72%. The upward trend in the international quotation of pulp was kept along March, particularly in relation to short fiber. Coupled with the rise in the international quotations, the exchange rate valuation also had an impact over the index, expanding the consequences of these increases. As a result, the change in the pulp prices was the most influential factor on the sector’s performance in March/12.

Other chemical products: the chemical industry recorded in March a rise of 1.51% in relation to February 2012. It was the first increase after five decreases in a row (the first positive change was in October 2011). In the year, the sector registers a negative change of -1.61% and, comparing March 2012/March 2011, there was a fall of -1.74%, the second in a row in this comparison.  

Optical, electronic and computer equipment:  in the comparison with February, the change of 4.70% in March was the highest since the beginning of the series, in December 2009. In 2012, the sector accumulates a positive change of 6.11%, again the highest positive rate in the series.  All in all, in the March 2012/March 2011 analysis, the current prices are still below (3.30%), considering that this rate reached -11.82% in December 2011, -8.14% in January and -7.44% in February 2012. As March was a month in which the dollar was up, part of the rises impact is due to the high costs of the raw-materials.  On the other hand, the proximity with periods of increased sales of certain items, such as cell phones, can also explain the rise seen in the products of this activity.

Machinery and equipment: in March, the sector recorded a change of prices of 0.37% over the previous month, returning to the positive trend which had been interrupted in February. In the accumulated of twelve months, the change was of 3.76%. In the accumulated index of the year, the change was of 2.41%. It is worth mentioning that the prices in the sector are particularly responsive to the exchange rates fluctuation, which was positive in March. Besides, in March sales in the domestic and international trades were resumed.

Motor vehicles: In March 2012, the prices of motor vehicles remained almost stable, presenting a positive change of 0.01% compared with February. The accumulated of the year closed in -0.07% and in the accumulated of twelve months the change was of 2.37%.