In August 2020, industry prices rose 3.28% in relation to July 2020, the largest positive change in the series, which started in January 2014. The cumulative index in the year reached 10.80%. Compared to August 2019, the price change was 13.74%. In August, the prices of the 24 activities changed positively, against 20 in the previous month.

The Producer Price Index (IPP) for Mining and Quarrying and Manufacturing Industries, measures the evolution of “factory-gate” prices, without taxes and freight, and covers information by activities and by major economic categories, namely: capital goods, intermediate goods and consumer goods (durable and semi-durable and non-durable).

In August, industry prices rose, on average, 3.28% compared to July/2020. The four major changes were in the mining and quarrying industries (8.43%), petroleum refining and ethanol products (6.24%), other chemicals (4.13%) and food (4.07%). The sectors of greatest influence were: food (1.00 p.p.), oil refining and ethanol products (0.52 p.p.), mining and quarrying industries (0.44 p.p.) and other chemical products (0.32 p.p.).

The cumulative index in the year reached 10.80%, compared to 7.28% in July/2020. The activities with the greatest change were: mining and quarrying industries (34.91%), other transportation equipment (21.41%), wood (20.63%) and basic metals (20.57%). In the cumulative result for the year, the sectors with the greatest influence were: food (3.88 pp), mining and quarrying industries (1.57 pp), petroleum refining and ethanol products (-1.22 pp) and basic metals (1.19 pp).

In the cumulative index in 12 months, the price change was 13.74%, against 11.13% in July/2020. The four major changes were in food products (27.45%), other transportation equipment (24.66%), wood (21.40%) and basic metals (18.97%). The sectors of greatest influence were: food (6.06 p.p.), basic metals (1.15 p.p.), mining and quarrying industries (0.93 p.p.) and other chemical products (0.82 p.p.).

The price change of 3.28% in relation to July had the following impact on the major economic categories: 1.62% in capital goods; 4.03% in intermediate goods; and 2.54% in consumer goods, with 0.60% in durable consumer goods and 2.94% in semi-durable and non-durable consumer goods.

From the result of the general industry, 3.28%, the influence of the Major Economic Categories was: 0.13 pp of capital goods, 2.19 pp of intermediate goods and 0.96 pp of consumer goods. In the case of consumer goods, 0.04 pp was due to price changes observed in durable consumer goods and 0.92 pp in semi-durable and non-durable consumer goods.

Industry prices accumulated in the year a high of 10.80%, with 12.64% being the change of capital goods (with influence of 0.95 pp), 13.67% of intermediate goods (7.30 pp) and 6.53% of consumer goods (2.55 pp). Consumer goods were influenced by 0.43 pp by durable consumer goods and 2.12 pp by semi-durable and non-durable consumer goods.

Compared to August 2019, industry prices rose 13.74%, with the following changes: capital goods, 14.36% (1.09 pp); intermediate goods, 14.71% (8.00 pp); and consumer goods, 12.22% (4.65 pp), with the influence of consumer durables being 0.57 pp and that of semi-durable and non-durable consumer goods was 4.08 pp.

Here are the main highlights:

Mining and quarrying industries: in relation to July, sector prices changed, on average, 8.43%, the fifth consecutive positive change in the year. With that, the cumulative index in the year reached 34.91%. It is worth mentioning that the previous changes were the largest among those observed in the industry. In the comparison against August 2019, the change was 17.56%.

The sector is a highlight because, in terms of influence, it was the third largest in M​​/M-1 (0.44 pp, in 3.28%) and in M/M-12 (0.93 pp, in 13.74%) and the second in the cumulative index in the year (1.57 pp, in 10.80%).

Food: compared to July, prices rose 4.07%, the biggest change since March 2020 (4.23%). As a result, the sector cumulative index an increase of 16.51% in 2020, the highest one for August only to be matched by August 2012 (14.41%). Compared to August 2019, the change was 27.45%, again the highest in the series. In this comparison, the months of July and August 2020 and December 2010 are the only ones in the series that exceeded 20% (in December 2010, 21.24%; in July 2020, 23.69%).

In addition to the sector making the largest contribution to the overall calculation (26.17%), it achieved, in module, the fourth largest change compared to July, and the first change compared to August 2019. In addition, it was the major influence in the three comparisons (1.00 pp, at 3.28% - M/M-1; 3.88 pp, at 10.80% - cumulative index in the year; and 6.06 pp, at 13.74% - M/M-12).

Among the products, only “semi-bleached or blanched rice, even polished or burnished” was a highlight in change and influence. The rise in product prices was linked to greater demand, including foreign market demand. The other three products with the greatest influence on the result (the influence of the four was 2.20 pp, at 4.07%) were: “soybean extraction residues”, “crude soybean oil, even degummed” (both also suffered the impact of a higher demand for soybeans) and "sterilized/UHT/Long Life milk" (in winter the intake in dairy basins usually decreases along with the supply of milk derivatives).

Petroleum refining and ethanol products: on average, the sector's prices changed, compared to July, by 6.24%. It is the third consecutive month of positive changes, which led to a cumulative change in these three months of 38.98%. Even so, in the cumulative result for the year, the figure is still negative, -11.41%, and the same goes to the August 2020/August 2019 comparison, -1.18%.

The sector stands out, among all industry activities and in module, as the second biggest change in the August versus July comparison, the second biggest influence when comparing the August prices against July (0.52 pp, in 3.28%) and the third influence in the cumulative index in the year (-1.22 pp, in 10.80%).

Among the products, the most intense changes, in the comparison between August and July, were positive, both those highlighted in terms of change and in terms of influence, except for that observed in “lubricating oils with additives”, which appears prominently among the most intense price change products.

The four products with the greatest influence (amounting to 5.27 pp, in 6.24%) are the four products of greater weight in the calculation of the sector index, namely: “diesel fuel” (weight of 40.74 %); “Gasoline, except for aviation” (23.05%); “Ethyl alcohol (anhydrous or hydrated)” (15.76%); and “fuel oils, except diesel” (5.26%).

Other chemical products: the chemical industry, in the month of August, presented an average price change, in relation to July, of 4.13%, second increase after two consecutive months of fall. Thus, the sector cumulative index a positive change of 12.88% in 2020, higher than the cumulative change until August in 2019, which was -4.18%. In relation to the cumulative in 12 months, the activity reached 10.09%.

The results observed in recent months are linked 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 32.9%, corroborated by the depreciation of the 3.4% in August) and the reduction in supply.

Basic Metals: when comparing the average prices of August against July, there was a change of 3.12%, the seventh increase observed in the year (only in June, there was a drop in prices, of -3.22%). As a result, the cumulative index in 2020 was 20.57% and the cumulative index in 12 months reached the change of 18.97%. A point to be highlighted in the cumulative change in the year is that this is the highest result for a month of August in the whole time series.

This month, the sector stood out, among all the activities analyzed, in four criteria: it was the fourth largest cumulative change in the year and in the cumulative index in 12 months, the fourth major influence in the cumulative index in the year (1.19 pp, in 10, 80%) and the second biggest influence in the cumulative index in 12 months (1.15 pp, in 13.74%).

The result of the month was obtained thanks mainly to three products, all from the non-ferrous group and with positive price changes. They are: “copper and copper alloy bars, profiles and rebars”, “aluminum oxide (calcined alumina)” and “gold for non-monetary uses”. The product "aluminum plates and strips, thicker than 0.2mm" also stood out as one of the main influences, but negatively impacting the result. These four products represent 1.37 pp of the change in the month, with 1.75 pp for the remaining 20 products.