Industry prices changed -1.46% in December, a result higher than that of November (-1.62%). In the same comparison, 13 of the 24 activities had positive price changes, compared to 10 in the previous month. In the year, the prices of the industry accumulated a high of 9.76%. The support material for the Producer Price Index release is available on this page.

Between November and December of 2018, the prices of the mining and manufacturing industries – overall industry – changed -1.46%, a figure above that reported in the comparison between October and November (-1.62%). The four highest changes in the comparison, came from the products of the following activities: petroleum refining and ethanol products (-9.36%), mining and quarrying industries (-8.13%), other chemical products (-2.96%) and other transportation equipment (2.18%).

The highest influences in the same comparison were: petroleum refining and ethanol products (-1.13 pp.), mining and quarrying industries (-0.39 pp), food products (0.37 pp) and other chemical products (-0.32 pp).

The cumulative indicator in the year – December/2018 against December/2017 – hit 9.76%, against 11.38% in November/2018. Among the activities that registered the highest percentage changes in this indicator, the highlights were: mining and quarrying industries (26.58%), other chemical products (19.70%), other transportation equipment (15.89%) and basic metals (13.94%). The sectors of greatest influence were: other chemical products (1.90 pp), food products (1.57 pp), basic metals (1.12 pp) and mining and quarrying industries (1,04 pp).

Among the Major Economic Categories, the change of prices of -1.46% in December was distributed as it follows: 1.17% in capital goods; -2.66% in intermediate goods; and 0.08% in consumer goods: 0.49% in durable consume goods and -0.05% in semi-and non-durable consumer goods. From the result of the overall industry (-1.46%), the influence of the Major Economic Categories was the following: 0,10 pp of capital goods, -1.58 pp of intermediate goods and 0.03 pp of consumer goods. In the case of consumer goods, -0.01 pp was due to price changes observed in semi and non-durable consumer goods and 0.04 p.p. in durable consumer goods.

The cumulative rate of the year (December 2018 against December 2017) of 9.76%: 10.86% for capital goods (influence of 0.93 pp), 13.25% for intermediate goods (7.55 pp) and 3.71% of consumer goods (1.28 pp). In the latter case, the result was influenced in 0.50 pp by durable consumer goods and in 0.78 pp, by semi- and non-durable consumer goods.

The following sectors stood out:

Mining and quarrying industries: in December 2018, the sector presented decrease of prices by the third month in a row. The drop in relation to November (-8.13%) was the second bigger among the industry sectors. The activity exerted the second greatest negative influence (-0.39 pp) and all the surveyed products, except "copper ore", negatively influenced the monthly change, with a highlight to the "crude petroleum oil".

 Even with the monthly result, the cumulative change remained positive (26.58%) and above the other surveyed activities. The sector stood among the biggest influences (in module and positive) in the cumulative index: 1.04 pp. This cumulative change had a positive influence of all products surveyed in the activity.

Food products: in December, the sector's price changed, on average, 2.01%, the seventh positive rate of the series of the year and the third sharpest. All in all, the sector accumulated a positive change along the 12 months of 2018, 8.23%, completely opposite from what happened in the cumulative index of 2017, when the 12 cumulative months stood at -7.28%, but very close to the time series' average of the changes in this type of indicator (cumulative in 12 months) which is equal to 7.70%, considering all the IPP series since 2010.

In relation to November 2018, the highs of three products stood out: "fresh or cooled pork", "cacao butter" and "residues of soybean extraction". The latter is also one of the highlights of influence in the activity's result. The other most influential products – the four of them accounted for 1.87 pp in 2.01% – were: "concentrated orange juice", fresh or cooled beef" and "granulated sugar".

The sector of food products, responsible for the biggest contribution in all activities, was the third biggest influence in the module (0.37 in -1.46%) in relation to November and the second greatest influence in the year.

Petroleum refining and ethanol products: in December, the average change of the products of the sector was of -9.36%, and, just like last month, it was the highest change in module among all the analyzed activities, accumulating in those two months an average price reduction of -15.92%.  This value is the highest negative change of this activity since January 2010 (beginning of the time series). With the cumulative result of December, the cumulative index of the month reached 6.69%, a lower value than that accumulated in 2017, which was of 18.70%. It is worth saying that from May to October 2018, the cumulative index in the last 12 months was kept above the 30%.

The four products with the sharpest changes were also the most influential, all with price decrease: "naphthas", "motor gasoline", "diesel fuel and other fuel oils" and "aviation kerosene".

Other chemical products: in December, the chemical industry presented an average change of prices, in relation to November, of -2.96%, the second negative change in a row after a succession of 14 months of price rise (between September 2017 and October 2018). Even with those price falls in the last two months of the year, the sector accumulated a positive change, of 19.70% in 2018.

The results seen in the month are linked to the international proves, with reduction of the raw material prices, to the petroleum derivatives (drop in the month), especially naphthas, and to the Real/Dollar exchange rate, which has accumulated appreciation of 5.6% in the last three months.

The chemical sector stood out in five analyzed indicators: it was the third largest change (in module) in the M/M-1; the second largest cumulative change in 2018; the fourth largest influence in the monthly change, with -0.32 p.p. in -1.46%; the greatest influence on the cumulative change in the year, with 1.90pp in 9.76%; and, in addition, represents the third largest weight in the calculation of the general indicator, with a contribution of 10.99%.

Three of the four products of greatest influence registered negative figures: "unsaturated ethylene (ethane)", "polypropylene (PP)" and "unsaturated propane (propylene)". The sole positive influence was the product "NPK-based manure or fertilizers". Those four products were responsible for -1.64 percentage points in the change of -2.96% of the sector. Regarding the cumulative rate in the year, all products recorded positive figures: "NPK-based manure or fertilizers", "unsaturated ethylene (ethane)", "herbicides for agricultural use" and "polypropylene (PP)".

Basic metals: in relation to November 2018, there was a change of -1.51%, the third negative change in a row. Even with this result, the activity accrued a change of 13.94% in the year; very close to the value of the end of 2017 (13.40%). The prices of this sector recorded a cumulative high of 48.65% between December 2013 (base of the time series) and December 2018.

The four products with the largest price changes versus the previous month were also the most influential, with three having price reductions: "unwrought non-alloy aluminum", "coils or sheets of stainless-steel including strips" and "carbon steel ingots, blocks, billets or plates", in contrast the product "carbon steels wire rod" with a positive price change. These four products, in relation to the total change of the month, represented -1.47 pp of the total of -1.51% of the activity.

The main cumulative influences in the year were the products "carbon steel cold rolled coils, uncoated", "carbon steel hot rolled coils, uncoated", "carbon steel ingots, blocks, billets or plates" and "Galvanized steel coils or sheets".

The behavior of the sector is influenced by the results of steel groups (steel) and nonferrous materials (copper and aluminum), which have different behavior. The steel group is affected by the surplus steel in the world (despite the production cuts in China), by the changes of the Dollar against the Real, by the fluctuation of iron ore values (price recovery since the second half of 2017), by the increase of the automotive sector and by the protectionist measures of the European Union and the United States. Non-ferrous materials' prices tend to be influenced by international exchanges.