Industrial prices changed -0.43% in November 2023 over October, reversing the signal of the change in the last three months. In this same comparison, prices of 13 out of 24 industrial activities dropped. The cumulative index in the year reached -4.89% and the cumulative index in 12 months, -6.09%.  The IPP had been -0.52% in November 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 broad economic categories.

The four activities with the highest changes over the previous month were: mining and quarrying industries (-7.09%), other transportation equipment (-2.11%), wood (-1.77%) and tobacco (-1.73%). Mining and quarrying industries was the industrial sector with the most intense negative influence in the monthly comparison: -0.37 percentage points (pp) of influence in the change of -0.43% of the overall industry.

Other activities that also stood out were food (with 0.14 pp of influence), other chemicals (-0.11 pp) and petroleum refining and biofuels (0.09 pp).

The cumulative index in the year stood at -4.89%, the lowest one for November since the beginning of the time series in 2014. As a comparison, the cumulative rate up to November 2022 had been 4.48%. Among the activities, the highest cumulative changes in the year, in module, were:  pulp and paper (-16.91%), other chemicals (-16.32%), petroleum refining and biofuels (-11.89%) and basic metals (-10.18%).

On the other hand, the major influences came from other chemicals (-1,43 pp), petroleum refining and biofuels (-1.42 pp), food products (-0.81 pp) and basic metals (-0.57 pp).

The cumulative index in 12 months was -6.09% in November  against -6.18% in October. The four most intense changes over the same month in 2022 were: other chemicals (-18.66%), pulp and paper (-16.96%), petroleum refining and biofuels (-16.71%) and basic metals (-11.35%). The sectors with the biggest influence on the aggregate result were: petroleum refining and biofuels (-2.09 pp), other chemicals (-1.66 pp), food products
(-0.74 pp) and basic metals (-0.70 pp).

Among the broad economic categories, the November´s result impacted in this way: -0.40% for capital goods (BK), -0.66% for intermediate goods (BI), and -0.09% for consumer goods (BC), being the change reported in durable consumer goods (BCD) of 0.31% and that in semi and non-durable consumer goods (BCND) of -0.18%.

Intermediate goods accounted for the major influence among the broad economic categories, whose weight in the overall index was 55.85%, having accounted for -0.37 pp of change and of -0.43% in mining and quarrying and manufacturing industries.

Consumer goods (-0.03 pp) and capital goods (-0.03 pp) completed the list. In the case of consumer goods, the influence registered in November was split into 0.02 pp, due to changes in prices of durable consumer goods and -0.05 pp, of semi and non-durable consumer goods.

The cumulative index in the year of the broad economic categories were: capital goods (-1.26%); intermediate goods (-7.43%) and consumer goods (-1.50%), being 2.51% for durable consumer goods and -2.29% for semi and non-durable consumer goods.

In terms of influence on the cumulative index in the year, capital goods accounted for -0.09 pp of the rate of -4.89% registered by the overall industry until November this year. Intermediate goods, in turn, accounted for -4.27 pp, whereas consumer goods exerted an influence of -0.53 pp on the aggregated result of industry, an influence shared by prices of durable consumer goods (0.15 pp) and semi-durable and non-durable consumer goods (-0.67 pp).

Considering the cumulative index in 12 months, the change of prices of capital goods was of -0.29% in November 2023. The prices of intermediate goods, in turn, changed -9.34% in the period of one year and the change in consumer goods was of -1.91%, with durable consumer goods having changed by 2.34% and semi and non-durable consumer goods, -2.74%.

Representing 7.74% of the overall index, capital goods accounted for -0.02 pp of the cumulative change of -6.09% in industry for 12 months in this reference month. The result of November 2023 was also influenced by -0.06 pp from consumer goods and by -5.40 pp from intermediate goods.

The result of consumer goods, in particular, was influenced in 0.13 pp by durable consumer goods and in -0.80 pp by semi and non-durable consumer goods. The latter weighting 82.89% of the index of that broad category.

Mining and quarrying industries - After four months, the change in the prices of this sector fell -7.09% compared with the previous month. As a result, the cumulative change on the year retreated from 14.81% in October to 6.67% in November. Lastly, the cumulative index in 12 months stayed at -1.02%, returning to the negative side, though less intensely than the rate that prevailed between January and September, whose average was -16.70%.

This sector stood out due to the monthly comparison, having recorded the most intense negative change among the sectors surveyed and the biggest influence (-0.37 pp in -0.43%).

Food products - The price change was positive (0.56%) for the third month in a row. As a result, the cumulative index in the year stood at -3.36%. As happening since April, the cumulative index in 12 months remained low, changing -3.09%.

This sector stood out due to the fact that it accounted for the second biggest influence on the M/M-1 (0.14 pp out of -0.43%) and the third one both on the cumulative index in the year (-0.81 out of -4.89%) and on the cumulative index in 12 months (-0.74 pp out of -6.09%).

The four products that mostly influenced the result exerted an aggregate influence of 0.00 pp out of 0.56%. Two products registered a negative change: “fresh or cooled beef” and “VHP sugar” and two products, a positive change: “residue of soybean oil extraction” and “frozen poultry and giblets.”

The appreciation of the real against the dollar (3.3% between October and November) impacted the prices of exporting products, like those with a negative change mentioned above. A higher supply of animals for slaughtering contributed to the drop in the prices of beef along the year. In the case of chicken, November was a month with less business days, which impacted the supply and caused the price to rise. Lastly, a higher demand, both domestic and foreign, partly explained the rise in the price of “residue of soybean oil extraction.”

Petroleum refining and biofuels - Between October and November 2023, the prices in this sector increased, on average, 0.83%, being the fourth consecutive month of increases and slightly below the previous rate (0.86%). As a result, the cumulative index in the year stayed at -11.89%, a very different scenario than the last year, since the cumulative rate was 17.48% until November 2022. Lastly, the change in the M/M-12 remained on the negative side (-16.71%) as it has been since March 2023 (-10.42%).

The four products that mostly influenced the result were: “diesel fuel”, “gasoline, except for aviation”, “fuel oils, except diesel” and “ethyl alcohol (anhydrous or hydrated).” Altogether, they accounted for 0.85 pp of the change of 0.83%, i.e., the other six products accounted for -0.02 pp.

Other chemicals - After rising for three months, the chemical industry retreated once again: -1.36% over October, highlighting this sector in terms of influence on the month´s result (M/M-1). Having the fourth biggest weight in the overall index, chemicals accounted for -0.11 pp of the change of -0.43% of the IPP over the previous month.

The prices of the products consumed in farms were the major responsible for the rate recorded between October and November. “NPK-based manure or fertilizers” and “ herbicides for agricultural use”, the two products with the biggest weight in this sector, were sold at lower prices this month and more than offset, for example, the rise in the other products that stood out in terms of influence on the activity aggregate.

That same dynamics can be perceived at the level of the economic groups surveyed: inorganic chemicals (with the important weight of fertilizers) and pesticides showed lower prices in November against the previous month. In both groups, the prices practiced in the end of the year followed a dynamics similar to that noticed in the same period of 2022, in which the demand for the items remained moderate.

Basic metals - In November, the change in the prices of this activity was -1.43% over the previous month, the seventh consecutive drop noticed in this indicator. As a result, the prices of that activity accumulated, on average, a drop of 10.18% in 2023, being the fourth most intense change among 24 activities surveyed in the IPP, as well as the fourth biggest influence on this indicator (-0.63 pp out of -4.89%). In the last 12 months, this sector accumulated a reduction of 11.35%, the fourth change and influence (-0.70 pp out of -6.09%) on the M/M-12 indicator.

This sector was being mainly influenced by non-ferrous metals and steel. The second group retreated 1.48% in November against October. The cumulative index in the year (-11.30%) was the second most intense result of this indicator for November since the beginning of the time series of the economic groups in 2019. The result of this group also remained negative in the last 12 months, dropping 13.26%.

It is worth highlighting that the steel group has been mainly affected by the low domestic demand for steel products and by the need to maintain competitive prices due to the higher volume of imports. In addition, steel products were also affected by the lower prices of iron ore in November, its major input.