In September 2020, industry prices rose 2.37% compared to August/2020, an increase below that observed in August/July (3.31%). The cumulative index in the year reached 13.46%, against 10.83% in August/2020. The cumulative index in 12 months was 15.89%, compared to 13.77% in August/2020. In September, 21 of the 24 activities increased in price, against 24 in August.

The Producer Price Index (IPP) for Mining and Quarrying and Manufacturing Industries collects “factory gate prices”, excluding taxes and freight, and covers the major economic categories: capital goods, intermediate goods and consumer goods (durable goods, semi-durable and non-durable goods).

In September 2020, industry prices rose, on average, 2.37% in relation to August 2020. The four biggest changes were in the activities of food (5.28%), furniture (4.17%), mining and quarrying industries (3.81%) and textiles (3.56%). The main influences were: food (1.31 pp), petroleum refining and ethanol products (-0.24 pp), mining and quarrying industries (0.21 pp) and other chemical products (0.16 pp).

The cumulative index in the year reached 13.46%, compared to 10.83% in August/2020. Among the activities, the major changes were: Mining and quarrying industries (40.05%), wood (24.21%), basic metals (23.05%) and food (22.81%). The sectors of greatest influence were: food (5.36 p.p.), mining and quarrying industries (1.80 p.p.), petroleum refining and ethanol products (-1.49 p.p.) and basic metals (1.34 p.p.).

In the cumulative index in 12 months, the price change was 15.89%, against 13.77% in August/2020. The four largest price changes occurred in mining and quarrying (36.34%), food (32.60%), wood (23.19%) and other transportation equipment (21.72%). The sectors of greatest influence were: food (7.25 p.p.), mining and quarrying industries (1.72 p.p.), basic metals (1.22 p.p.) and other chemicals (0.92 p.p.).

The price change of 2.37% in relation to August had repercussions as follows among the major economic categories: 1.31% in capital goods; 2.24% in intermediate goods; and 2.79% in consumer goods, with 1.53% being the change observed in durable consumer goods and 3.05% in semi-durable and non-durable consumer goods.

The influence of the economic categories on the IPP (2.37%) was: 0.10 p.p. of capital goods, 1.23 p.p. of intermediate goods and 1.05 p.p. of consumer goods. In the case of consumer goods, 0.10 p.p. was due to price changes observed in durable consumer goods and 0.95 p.p. in semi-durable and non-durable consumer goods.

In the cumulative result for the year, the price changes of the industry reached, until September, a change of 13.46%, with 14.00% being the change of capital goods (with influence of 1.05 pp), 16.20% of intermediate goods (8.66 pp) and 9.62% of consumer goods (3.76 pp). In the latter case, this result was influenced by 0.55 pp by durable consumer goods products and 3.21 pp by semi-durable and non-durable consumer goods.

In the September 2020/September 2019 comparison, the industrial price change reached 15.89% in September, with the following changes: capital goods, 15.03% (1.14 pp); intermediate goods, 16.75% (9.10 pp); and consumer goods, 14.85% (5.66 pp), with the influence of durable consumer goods being 0.64 pp and that of semi-durable and non-durable consumer goods of 5.01 pp.

Here are the main highlights:

Mining and quarrying industries: in September, sector prices rose 3.81% in relation to August. Positive rates have been repeated since April, with September's result only above June's, 3.75%. The cumulative index in the year was 40.05%, the second highest rate in the series, which peaked in September 2018 (41.64%). In the cumulative index in the last 12 months, the change was 36.34%, a sharper rate than that of August, 17.56%.

The sector was a highlight in all indicators, in terms of change and influence. In change, it is the third most intense compared to August and the first in the cumulative result in the year and in 12 months. In influence, it is the third in the monthly change (0.21 pp, in 2.37%), and the second in the cumulative index in the year (1.80 pp, in 13.46%) and in the last 12 months (1.72 pp, by 15.89%).

Food: prices in the sector rose 5.28% compared to August, the third highest result in the series started in January 2010 (5.47% in September 2015 and 5.30% in October 2010). With that, the cumulative result in the year (22.81%) and the cumulative in 12 months (32.60%) were the highest in their series. In addition to being the largest monthly change, food has the fourth change in the cumulative rate in the year and second in the cumulative in 12. In the case of influence, it was the first in the three cases, with the monthly indicator having an influence of 1.31 pp, in 2.37% of the mining and quarrying and manufacturing industries, in the cumulative index in the year, 5.36 pp, in 13.46% and in the cumulative in 12 months, 7.25 pp, 15.89%.

Among the products listed as those four with the sharpest changes and influences, only “semi-bleached or whitened rice, even polished or burnished” appears as both a highlight in terms of change and influence. The most influential product group (see table below) accounts for 3.16 p.p. of the 5.28% change.

A more intense demand, whether domestic (in the case of rice and chicken meat) or external (in the case of beef, soybean residue and again rice and chicken meat), explains this upward pressure, even in a month when the Real suffered a small (1.1%) appreciation against the Dollar. In the case of soybean derivatives (oil, which is not among the strongest influences, appears as a highlight in terms of change), a lower American supply also makes room for higher prices in the foreign market.

Petroleum refining and ethanol products: in September prices changed, on average, -2.83% in comparison with the previous month, after three consecutive positive price changes. As a result, the cumulative index in the year remained with negative changes, as it had been since February 2020, reaching -13.97%, against -11.47% observed in August. In the 12-month period, the change was -7.40%. The sector's highlight is due to the fact that it was the second influence in the monthly indicator (-0.24 pp, in 2.37%) and the third in the cumulative index in the year (-1.49 pp, in 13.46%) .

The negative changes, in the mining and quarrying and manufacturing industries as a whole, occurred in very few activities: compared to August, in addition to the “petroleum refining and ethanol products”, there were falls in “tobacco products manufacturing” and “manufacturing of other transportation equipment, except motor vehicles ”, both closely linked to the exchange rate trends (which appreciated by 1.1% in September); cumulatively, a single activity follows the negative trend, “beverage manufacturing”. As compared to September 2019, there is no other activity that accumulates negative changes.

Other chemicals: Chemical industry prices rose 2.03 in September, compared to August, the third increase after two consecutive months of decline. The sector accumulated a positive change of 15.19% in 2020, almost 20 pp above the cumulative change up to September 2019, which was –3.24%. In the cumulative perpective in 12 months, the activity reached 11.24%. The results of the last months are due to international prices, with an increase in the price of several imported raw materials, largely due to the depreciation of the Real against the Dollar ( the depreciation in the year was 31.4%, despite the appreciation of the 1.1% against the dollar in September) and the reduction in supply.

Basic metals: the sector registered an increase of 2.27% in September, in relation to August, the third positive change in a row in the year and with this result, the activity accrued, in the year, a change of 23.07% and, in the last 12 months, 20.05%. The cumulative value in the year was the highest for this activity in the entire IPP series, which started in January 2010. An analysis of the index numbers of the series indicates that between December 2018 (base of the current series) and September 2020, the prices of the sector had a cumulative change of 21.00%.