Producer Price Index (IPP) rises 1.86% in August
September 29, 2021 09h00 AM | Last Updated: October 01, 2021 04h52 PM
In August 2021, the industrial prices rose 1.86% over July 2021, a similar percentage as that of July 2021 over the previous month. For the second time in the IPP time series, started in 2010, the prices of the 24 activities registered positive changes; in July 2021, they were 20. The cumulative rise in the year hit 23.55% and the cumulative rate in 12 months, 33.08%.
|Cumulative in the year||23.55%|
|Cumulative in 12 months||33.08%|
The Producer Price Index - IPP of the Mining and Manufacturing Industries measures the evolution of the prices of products "at the factory gate", free from taxes and freight, and encompasses information by major economic category, i.e., capital goods, intermediate goods and consumer goods (durable and semi and non-durable).
The four biggest changes were among the products of the industrial activities of tobacco (3.14%), non-metallic minerals (2.98%), computer computer equipment, electronic and optical products (2.89%) and other chemicals (2.82%). The most influential items were food products (0.51 percentage points), other chemicals (0.25 p.p.), petroleum refining and ethanol products (0.19 p.p.) and basic metals (0.19 p.p.).
|Producer Price Index, according to Mining and Manufacturing Industries (Overall Industry) and Sections - Last three months|
|Activities||Month/previous month||Month/same month last year||Cumulative in the year|
|Change (%)||Change (%)||Change (%)|
|B - Mining and Quarrying Industries||8.71||3.61||1.16||115.55||95.12||82.03||60.76||66.56||68.49|
|C - Manufacturing Industries||0.74||1.72||1.91||32.88||31.65||30.24||16.66||18.66||20.93|
|Source: IBGE, Diretoria de Pesquisas, Coordenação de Indústria|
The cumulative index in the year up to August hit 23.55%, against 21.29% in July 2021. Among the activities that registered the highest percentage changes in this indicator, the highlights were: mining and quarrying industries (68.49%), oil refining and ethanol products (47.03%), basic metals (40.59%) and other chemicals (37.34%). The sectors that influenced this indicator the most were: oil refining and ethanol products (3.96 p.p.), mining and quarrying industries (3.77 p.p.), food products (3.20 p.p.) and other chemicals (2.99 p.p.).
In the comparison with August 2020, the price change was of 33.08%, against 34.97% in July 2021. The four biggest changes were in mining and quarrying industries (82.03%), basic metals (56.98%), oil refining and ethanol products (56.84%) and other chemicals (50.49%). On the other hand, the most influential sectors were: food products (6.37 p.p.), oil refining and ethanol products (4.84 p.p.), mining and quarrying industries (4.50 p.p.) and other chemicals (3.98 p.p.).
The change of 1.86% from July reflected in the major economic categories in the following way: capital goods, 1.97%; intermediate goods, 1.77%; and consumer goods, 1.99%, with 1.25% being the change observed in durable consumer goods and 2.13% in semi and non-durable consumer goods.
The influence of the Major Economic Categories on the IPP was: 0.13 p.p. in capital goods, 1.04 p.p. in intermediate goods and 0.68 p.p. in consumer goods, in which 0.07 p.p. were attributed to changes in the durable consumer goods and 0.61 p.p. to semi and non-durable consumer goods.
In the cumulative index in the year, the changes in the industrial prices hit 23.55%, being 14.09% the change in capital goods (influencing 1.03 p.p.), 30.44% in intermediate goods (16.95 p.p.) and 15.04% in consumer goods (5.57 p.p.), which was influenced by durable products by 0.73 p.p. and by semi and non-durable products by 4.84 p.p.
In the comparison with August 2020, whose change was 33.08% against 34.97% in July 2021, capital goods increased 17.76% (influencing 1.35 p.p.); intermediate goods, 42.79% (23.45 p.p.); and consumer goods, 22.02% (8.28 p.p.), being the influence of durable consumer goods of 1.06 p.p. and that of semi and non-durable consumer goods, of 7.22 p.p.
|Producer Price Indexes, according to Mining and Manufacturing Industries (Overall Industry) and
Major Economic Categories - Last three months
|Overall Industry and Sections||Changes (%)|
|M/M-1||Cumulative in the year||M/M-12|
|Capital Goods (BK)||0.81||2.29||1.97||9.37||11.88||14.09||16.14||17.23||17.76|
|Intermediate Goods (BI)||1.49||1.78||1.77||25.92||28.17||30.44||49.35||45.95||42.79|
|Consumer Goods (BC)||1.05||1.90||1.99||10.70||12.80||15.04||23.28||22.81||22.02|
|Durable consumer goods (BCD)||1.92||1.38||1.25||8.92||10.42||11.81||15.61||16.05||16.67|
|Semi-durable and non-durable consumer goods (BCND)||0.88||2.00||2.13||11.05||13.27||15.69||24.90||24.22||23.11|
|Source: IBGE, Diretoria de Pesquisas, Coordenação de Indústria|
The major highlights were:
Mining and quarrying industries: the prices of this sector changed, on average, 1.16% in relation to July, the third consecutive positive rate and the lowest one of them (8.71% in June and 3.61% in July). Therefore, the cumulative index in the year accelerated from 66.56% in July to 68.49%. In 12 months, the rate was 82.03%, the second lowest in the year (January, with 54.74%, was the lowest one).
This sector recorded the highest change among all the industrial activities, both in the cumulative index in the year and against August 2020. In addition, it was the second major influence on the cumulative index in the year (3.77 p.p. in 23.55%) and the third one on the cumulative index in 12 months (4.50 p.p. in 33.08%).
Although the two major products in this sector, “crude petroleum oil” and “iron ores and their concentrates (except pelleted or sintered)”, positively influenced the longer-term indicators, the impact of “crude petroleum oil” was negative in the August/July comparison, in line with the international prices of the commodity.
Food products: the prices of this sector changed 2.19% in August over July. It was the seventh positive rate registered along the year (the only negative rate was in June, -0.14%) and the second highest rate in 2021 (just behind April, 2.66%). Therefore, the cumulative index in the year accelerated from 10.06% in July to 12.47%. As it was occurring since June, the result of the last 12 months was lower than that recorded in the previous month (June 2021/June 2020, 30.96%; July 2021/July 2020, 28.19%; and August 2021/August 2020, 25.72%).
This sector exerted the major influence both on the comparison with the previous month (0.51 p.p. in 1.86%) and on the comparison with the same month of 2020 (6.37 p.p. in 33.08%). In addition, it was the third biggest impact on the cumulative index in the year (3.20 p.p. in 23.55%).
In the three indicators, the groups whose prices changed above the sector average were: “slaughtering and manufacture of meat products” (2.72% in M/M-1; 14.05% in the cumulative index in the year; and 31.42% in M/M-12), “manufacturing and refining of sugar” (3.64%; 19.07%; and 26.13%) and “roasting and grinding of coffee” (6.54%; 25.74%; and 33.39%). “Manufacture of vegetal and animal fats and oils” also stood out in the 12-month comparison (34.48%).
Oil refining and ethanol products: it rose for the fourth consecutive month compared with the previous month. It rose 1.91% in August, lower than in July (3.27%), though higher than the other two. As a result, the cumulative rate in the year changed from 44.27% in July to 47.03%, being the highest one for August in the time series. The change was of 56.84% in the last 12 months, the lowest one since March (52.67%). It is worth noticing that the prices had changed 6.57% between December 2018 (base of the current time series) and August 2020, a result quite lower than what occurred in the last 12 months (56.84%).
This sector registered the second highest change in the cumulative index in the year and the third one in the comparison with August 2020. In addition, it was the second major influence on the annual comparison (4.84 p.p. in 33.08%) and the third one on the monthly comparison (0.19 p.p. in 1.86%).
Other chemicals: the chemical industry recorded a price change of 2.82% in August, the highest positive rate since April (4.73%), with a cumulative change of 37.34% in the year and of 50.49% in the last 12 months.
The sector of other chemicals recorded the fourth highest price change this month, in the cumulative index in the year and in the cumulative rate in 12 months, besides exerting the second biggest influence this month (0.25 p.p. in 1.86%) and the fourth one both on the cumulative index in the year (2.99 p.p. in 23.55%) and on the cumulative rate in 12 months (3.98 p.p. in 33.08%).
These results are mainly linked with the international prices, including several raw material, either imported or not, like naphtha. The biggest responsible for that increase was in the group of “manufacture of inorganic chemicals”, more specifically in fertilizers. The price change in this group was of 6.93% in the month, accruing a change of 65.98% in the year and of 73.63% in the last 12 months. Both the cumulative indexes were the highest ones in the entire time series.
On the other hand, the group of “manufacture of resins and elastomers” registered a negative price change for the fourth consecutive month, now hitting -1.02%, even changing 31.12% in the year and 69.61% in the last 12 months. Finally, in the group “manufacture of pesticides and household disinfectants”, the result was 0.66% in the month, a cumulative change of 10.68% in the year and a cumulative figure of 10.79% in 12 months.
Only two out of four most influential products to the result (1.68 p.p. in 2.82%) increased their prices: “NPK manure or fertilizers” and “mineral of chemical phosphate manure or fertilizers”. The other two highlighted products recorded negative changes: “benzene” and “vinyl poly-chloride (PVC)”. The other 35 products surveyed in this activity also had, on the average, a positive result with 1.14 p.p of the final change of the activity.
Basic metals: it rose 2.58% in August over July, the 14th positive rate in a row in this activity. Even with this result, the sector of basic metals accrued a change of 40.59% in the year and, in the last 12 months, of 56.98%. Between December 2018 (base for the current sample) and August 2021, the prices of the sector had a cumulative increase of 85.73%, only second to the cumulative increase of mining and quarrying industry, 178.96%, activity that includes iron ore, main raw material for steel.
This sector of basic metals registered the third biggest change in comparison with the 24 activities of the survey, and the second one in 12 months, as well as the fourth biggest influence on the month´s result (0.19 p.p. in 1.86%).
Considering the economic groups in this activity, steel industry recorded a change of 2.52%, thus resulting in a cumulative index of 57.09% in the year and of 87.41% in 12 months. The last two figures were above the average for the activity.
The four products that mostly influenced the month´s results posted positive changes, being three of them also common in the influence in the year and in the cumulative index in 12 months. They were: “carbon steel ingots, blocks, rods or plates”, “uncoated hot-rolled steel carbon coil” and “aluminum plates and strips, of a thickness exceeding 0.2 mm”. “Stainless steel coil or sheet, including strips” stood out in the month´s result, whereas “galvanized steel coils or plates” stood out in the results of the cumulative indexes in the year and in 12 months.