In October 2023, industry price changed by 1.11%¨from September, third consecutive positive result. In this same comparison, prices of 14 of the 24 industrial activities rose. The cumulative index in the year stood at -4.43%, the lowest for a month of October since the beginning of the time series in 2014. The cumulative index in 12 months stood at -6.13%. The IPP had been -0.86% in October 2022.

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 the major economic categories.

Among the activities analyzed, the four main changes were: beverages (6.12%); mining and quarrying industries (5.26%); other transportation equipment (2.19%); and food products (2.00%). In the monthly comparison, food products was the most relevant sector of industry in the composition of the aggregate result. This activity accounted for -0.48 percentage points (p.p) of influence on the change of general industry (1.11%).

Other activities that stood out were mining and quarrying industries (accounting for 0.26 p.p.), beverages (for 0.15 p.p) and petroleum refining and biofuels (-0.10 p.p.).

The cumulative index in the year hit -4.43%. For the sake of compaison, last year (2022) the cumulative rate up to October had been of 5.03%. The cumulative rate in the year up to this reference month is the lowest ever registered for a month of October since the beginning of the time series in 2014.

The highest cumulative changes in the year among the activities were those of: pulp and paper (-15.48%), other chemicals (-15.18%) mining and quarrying industries (14.81%) and petroleum refining and biofuels (-12.56%).

The main influences came from petroleum refining and biofuels (-1.51 p.p.), other chemicals (-1.33 p.p.), food products (-0.94 p.p.) and mining and quarrying industries (0.64 p.p.).

The cumulative index in 12 months hit -6.13% in October. In the previous month, the indicator had reached -7.97%. The sectors accounting for the four biggest changes in prices in October against the same month a year ago were: other chemicals (-21.11%); petroleum refining and biofeuls (-16.54%); pulp and paper (-14.37%); and basic metals (-10.67%). The sectors accounting for the main contributions to the aggregate result were: petroleum refining and biofuels (-2.04 p.p.), other chemicals (-1.95 p.p.), food products (-1.02 p.p.) and basic metals (-0.66 p.p.).

Among the broad economic categories, the result of October was as follows: -0.34% of change for capital goods; 1.21% for intermediate goods; and 1.14% for consumer goods, with a change of 0.47% for durable consumer goods, and 1.28% for semi and non-durable consumer goods.

The main influence was exerted by intermediate goods, which represented 55.97% of the overall index and accounted for 0.68 p.p. of the change of 1.11% in mining and quarrying and manufacturing industries.

Consumer goods (influence of 0.41 p.p.) and capital goods (0.03 p.p.) complete the list. In the case of consumer goods, the influence was split into 0.03 p.p., for durable consumer goods and 0.38 p.p., for semi and non-durable consumer goods.

The cumulative index in the year the change in the broad economic categories reached: -0.96%, in the case of capital goods; -6.79% in intermediate goods; and -1.31% in consumer goods, in which durable consumer goods had a cumulative change of 2.44%, whereas semi and non-durable consumer goods, -2.05%.

In terms of influence on the cumulative index in the year, capital goods accounted for -0.07 p.p. of the rate of -4.43% registered by the overall industry this year. Intermediate goods, in turn, accounted for -3.90 p.p., whereas consumer goods exerted an influence of -0.46 p.p. on the aggregated result of industry, an influence shared by prices of durable consumer goods (0.14 p.p.) and semi-durable and non-durable consumer goods (-0.60 p.p.).

Regarding the cumulative index in 12 months, a variação de preços de bens de capital foi de 0,54% em outubro. Os preços dos bthe change in prices of capital goods was of 0.54%. Prices of intermediate goods, in turn, changed by -9.46% and the change in consumer goods was -1.96%, with durable consumer goods changing by 2.50% and semi and non-durable consumer goods, by -2.82%.

In terms of influence, representing 7.72% of the overall index, capital goods accounted for 0.04 p.p. of the cumulative change of -6.13% in industry for 12 months. There was, also, an influence of –0.68 p.p. from consumer goods and of -5.49 p.p. from intermediate goods.

The result of consumer goods was particularly influenced by durable consumer goods (0.14 p.p.) and semi and non-durable consumer goods (-0.82 p.p.), the latter with a contribution of 82.94% to the index of this broad category.

Mining and quarrying industries – The prices in this sector registered a positive change (5.26%) for the fourth month in a row. As a result, the cumulative result in the year hit 14.81% (in the same month a year ago it was 0.90%) and, for the first time since May 2022 (0.61%), the cumulative index in 12 months was positive, 4.77%.

The highlight given to the sector was due to the fact that, in terms of change (in module), the second highest change in M/M-1 and the third cumulative change in the year were both positive. In terms of influence, it was the second in terms of M/M-1 (0.26 p.p., out of 1.11%) and the fourth cumulative in the year (0.64 p.p., out of -4.43%).

Food products – For the second consecutive month, prices of the sector recorded positive results. In October, the change was of 2.00%, whereas, in September, it had been 0.40%. The result of October is the highest since July 2022, 2.77%.

With this result, the cumulative rate in the year stood at -3.87%. As for the cumulative index in 12 months, the result was -4.26%, leading to a sequence of negative results even lower since July 2023 (-10.94%).

The relevance given to the sector was due to the fact that the main contribution (24.30%) to the calculation of IG, had been, in module, the fourth highest (positive) one among prices of all sectors surveyed, and, in terms of influence, the first one on M/M-1 (0.48 p.p., out of 1.11%) and the third one cumulative in the year (-0.94 p.p., out of -4.43%) and cumulative in 12 months (-1.02 p.p., out of -6.13%).

The three main products, both in terms of influence and change, were “fresh or chilled beef”, “frozen poultry and giblets” and “VHP (very high polarization) sugar.” The fourth product, in terms of influence, is “semi-milled or milled rice, whether or not polished or burnished”. These four products, all of which recorded positive changes, accounted for 2.08 p.p. of the change of 2.00%, which means that -0.08 p.p. the net influence of other 39 selected products.

Beverages – In October, prices in the sector changed by 6.12%, opposite to what took place a month ago. The cumulative movement of the last few days shows rise of prices of August, those of October are 0.78% higher.

The cumulative index in the year was close to that in August (7.14%), but below the index in October 2022 (15.16%). The cumulative index in 12 months (8.36%) was above that of September (3.68%), but was below the results of months January to August. On the average, the change observed in these two months was 14.12%.

The sector of beverages showed the main rise in prices (6.12%) and accounted for the third main contribution to the global result (0.15 p.p. out of 1.11%).

Refino de petróleo e biocombustíveis – For the third consecutive month, prices in this sector recorded a positive change (0.92%), below those in the previous months, 7.55% in August and 8.25%, in September. With this result, the cumulative index in the year went from -13.36%, in September, to -12.56% in October (in the same month a year ago, the cumulative index in the year was 16.33%). As for the cumulative index in 2 months, the rate, as observed since March 2023, is negative, now at -16.54%, but far from the lowest rate in the series, -39.24%, of July 2023.

This sector stood out as it registered the fourth highest cumulative change in the year and the second most intense change in the cumulative indicator in 12 months (both of them negative). In terms of influence, it was the fourth on the monthly indicator (0.10 p.p. out of 1.11%) and the first, both cumulative in the year (-1.51 p.p, out of -4.43%) and in the cumulative index in 12 months (-2.04. out of -6.13%).

Other chemicals – The prices of chemicals completed the third month of increase at factory gate, and close October with a change of 1.07% from the September figure. The result keeps the out of phase effects of the international reference of petrochemicals, which had been high until the previous month, and exerted the main influence on the sector result of the current month.

The highlight in petrochemical industry in the IPP of October is related to long-term indicators. As for the aggregate result of the sector, both the cumulative index in the year (-15.18%) and in 12 months (-21.11%) remained negative and were among the main significant changes in general industry.

This magnitude of changes, together with the participation of the sector, third main one among the activities surveyed, also featured it as a highlight in teerms of influence on the overall index. Chemicals, listed among the four most influential items, accounted for -1.33 p.p in the change of -4.43% of cumulative IPP in the year and for -1.95% in the change of -6.13% in 12 months.

Accounting for such relevance, in long-term indicators, are the effectes observed before Q3 this year, when a combination of commoditie on continuous downward trend (petroleum and fertilizing macronutrients) and a lower demand (due to seasonal reasons, in some cases) drove prices of petrochemicals and fertilizers downwards.

Basic metals – In October, the change of prices of this activity reached -2.59% from the previous month, third consecutive negative result for this indicator. As a result, in 2023, prices of the activity, on the average, had a cumulative drop of 8.67%. In the last 12 months, the sector had a cumulative decrease of 10.67%, causeing the activity to stand out, as the fourth main one in terms of change and influence (-0.66 p.p. out of -6.13%) among the 24 activities surveyed in IPP.

In the last few months, the sector has been influenced, mainly, by non-ferrous and basic metals. The latter recorded a decrease of 1.68% in October, from September. The cumulative change in the year also dropped by -9.53%, a negative result in this indicator for a month of October since the beginning of the time series for economic groups, in 2019. In the last 12 months, the result of the group remains negative, with a drop of 12.80%.

The group basic metals has been affected, mainly, by the low domestic demand for steel products and by the need of keeping prices competitive due to the higher volume of exports. That has made up for the increase of iron ore (its main imput) in the last few months. The changes in the group non-ferrous metals are usually related to quotations of international stock markets and have been affected, mainly, by changes in the price of aluminium and the exchange rate (in October there was depreciation of 2.6% of the real against the dollar).