In October 2021, industry prices rose 2.16% from September. The cumulative index in the year reached 26.57% and the cumulative index in 12 months, 28.83%. in October, prices of 22 of the 24 activities, rose, against 20 in the previous month.

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).

In October 2021, industry prices rose 2.16% from September, more than observed in número superior ao observathe September/August comparison (0.25%). The four biggest changes took place among the products of the following industrial activities: oil refining and ethanol products (7.14%), other chemicals (6.38%), rubber and plastic (3.45%) and other transportation equipment (3.44%).

The sectors that accounted for the main contributions were: oil refining and ethanol products (0.73 p.p.), other chemicals (0.59 p.p.), basic metals (0.21 pp) and food products (0.18 p.p).

In October, the cumulative in the year reached 26.57%, against 23.90% in September. Among the activities with the biggest changes were: oil refining and ethanol products (60.38%), other chemicals (52.20%), basic metals (45.95%) and mining and quarrying industries (37.66%). The sectors responsible for the biggest contributions were: oil refining and ethanol products (5.09 p.p.) other chemicals (4.21 p.p.), food products (4.03% p.p.) and basic metals (3.00 pp).

The cumulative index in 12 months was of 28.83%, against 30.40% in September. The four biggest price changes were recorded in oil refining and ethanol products (72.02%), other chemicals (54.52%), basic metals (52.10%) and wood (39.40%).

The main sectors in this case were: oil refining and ethanol products (5.76 pp), food products (4.49 pp), other chemicals (4.39 pp) and basic metals (3.33 p.p.).

The change of prices by 2.16% against September had an effect on the results of major economic categories: capital goods, 1.72%; intermediate goods, 2.94%; and consumer goods, 0.94%, with 0.93% being the change observed in durable consumer goods and 0.94% in semi and non-durable consumer goods.

General Industry accounted for the following results: 0.12 p.p. for capital goods, 1.72 p.p. for intermediate goods and 0.33 p.p. for consumer goods. In the case of consumer goods, 0.05 p.p. was due to price changes of durable consumer goods and 0.28 p.p. of semi and non-durable consumer goods.

In the cumulative index in the year (26.57%), capital goods changed by 17.48% (with influence of 1.27 p.p.); intermediate goods, by 33.54% (16.98 p.p.) and consumer goods, by 17.89% (6.62 p.p.). In the last case, the result was influenced at 0,85 p.p. by durable consumer goods and 5,77 p.p., by semi-and non-durable consumer goods.

Considering the last 12 months (28.83%), the following changes were observed in Major Economic Categories: capital goods, 16.28% (1.22 p.p.); intermediate goods, 36.21% (20.12 p.p.); and consumer goods,20.27% (7.49%), being the influence of durable consumer goods o0.98 p.p. and that of semi and non-durable consumer goods, of 6.51 p.p. The following sectors stood out:

Food products: prices in October changed by an average 0.75% against those in September, lowest figure among the positive results in 2021, a year when only one month recorded a nebative change: June (-0.14%).

As a result, the sector has a cumulative positive price change of 15.68%, being 12.78 percentage points below the cumulative change recorded up to October 2020. Against the same month a year ago, the current figure ois 17.43%, lowest rate in the year, which has fallen since June (30.96%). It is worth pointing out that in October 2020, the comparison with the preceding month accounted for the fifth biggest change in the series: 4.67%. That month, prices had changed 35.99% against those in October 2019.

The highlight of this sector was due to influence. In this respect, that was the biggest influence on M/M-1 (0.18 p.p., out of 2.16%); the third one in cumulative terms (4.03 p.p., out of 26.57%); and the second in M/M-12 (4.49 p.p., out of 28.83%).

The four most influential products on M/M-1 accounted for 0.78 p.p. of the 0.75% change, so, -0.03 p.p. was the share of the other 39 products that form the basket in this activity. Only one of the four products, “esterilized milk/UHT/long life milk”, accounted for a negative figure, aligned with thw end of the dry period and the increase of obtention of milk in producing basins.

In the case of “very high polarization” sugar and “fresh or frozen beef”, the depreciation of real against the dollar (4.9% from September to October) is a reason, but in the case of beef, some meat processors indictae bigger demand, includin the restart of exports. In the case of sugar, limited exerts a growing effect on prices. At last, harsh winter still has an impact on the prices of “ground and roasted coffee”.

Oil refining and alcohol products: with positive results since May and the month-on-month comparison was 7.14%, in October, the third biggest result in the year (16.88%); 12.2% in February). As a result, the cumulative index in the year reached 60.38% (highest figure observed for the same month and the October 2021/October 2020 comparison, 72.02% (fourth highest in the series, with the three biggest results recorded in 2021: May, 106.57%; April, 91.25%; and June, 7.68%).

The results observed in October stood out as the most significant changes in the three indicators calculated, as well as the biggest influences (M/M-1: 0.73 p.p., out of 2.16%; cumulative in the year: 5.09 p.p., out of 26.57%; and M/M-12: 5.76 p.p., out of 28.83%).

From the perspective of the monthly change, among the products both in terms of change and influence, three of them, all oil products , including the most significant in the calculation of the sector (“diesel”, 40.74%; and “gasoline, except for aviation”, 23.05%), are present in both cases. The changes highlighted are all positive, and that is also observed in the other two indexes: cumulative in the year and cumulative in 12 months.

Other chemicals: : the chemical industry recorded in October the second biggest price change in IPP, 6.38%, with a cumulative change of 52.50% in the year and of 54.52% in the last 12 months.

These results are mainly linked with the international prices, including the price change of several raw material, either imported or not, like naphtha, for instance. Also, the demand of industry for chemicals is on an upward trend.

Considering a detailed analysis of the groups accounting for this increase, there is a concentration in “manufature of inorganic chemicals”, more specifically fertilizers, being the main reasons the significant increases of urea, lower production of fertilizers in the foreign market and appreciation of the dollar (4.9% in the month).

The price change in this group was of 13.53% in the month, biggest change since this group started being analyzed in the survey (january 2019), with a cumulative 98.65% in the year and of 96.35% in the last 12 months. Both the cumulative indexes were the highest in the entire time series. This sector stood out in the comparison with the 24 activities of the survey, for having the second biggest price change in the cumulative index in the year and the cumulative index in 12 months.

Furthermore, in terms of influence, it was the second biggest in the month (0.59 pp out of 2.16% of the general index) and repeated the position cumulative in the year (4.21 p.p. in 26.57%). In terms of the cumulative index in 12 months the index was 28.83% (4.39 percentage points).

Basic metals: the change of prices of thi sactivity was of 2.82%, 16th positive rate in this activity. With this result, the sector of basic metals recorded a change of 45.95% in the year and 52.10%, in the last 12 months.

Another highlight is that between December 2018 (base for the current sample) and October 2021, the prices of the sector had a cumulative increase of 92.81%, only second to the cumulative increase of mining and quarrying industries, 127.91%, activity that includes iron ore, main raw material for steel.

“The results of the sector are linked with the behavior of the groups of steel products and non-ferrous material (copper, gold and aluminum), whose prices behave differently. The former group is affected by the prices of iron ore and by the change of the dollar against the real, as well as by the recomposition of stocks in the consumption chain. Concerning the second group – non-ferrous materials –, prices used to be linked with the quotes in the international stock markets.