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Producer Price Index (IPP) was 1.31% in November

January 05, 2022 09h00 AM | Last Updated: January 07, 2022 11h19 AM

The industrial prices rose 1.31% in November 2021, below that registered in October (2.26%). The cumulative index in the year reached 28.36% and the cumulative index in 12 months, 28.86%.  Of the 24 activities, 17 increased their prices in November against 21 in the previous month.

Period

Rate (%)

November 2021 1.31
October 2021 2.26
Cumulative in the year 28.36
Cumulative in 12 months 28.86
November 2020 1.38

The Producer Price Index (IPP) of Mining and Quarrying and Manufacturing Industries measures the change in "factory-gate prices", free of taxes or freight, of major economic activities: capital goods, intermediate goods and consumer goods (durable, semi-durable and non-durable).

In November 2021, the industrial prices rose 1.31% over October. The four biggest changes were in oil refining and ethanol products (6.63%), mining and quarrying industries (-5.21%),  other chemicals (4.90%) and beverages (2.52%). The biggest influences were: petroleum refining and ethanol products (0.71 p.p.), other chemicals (0.47 p.p.), mining and quarrying industries (-0.31 p.p.) and fabricated metal products (0.07 p.p.).

Producer Price Indexes, according to Mining and
Manufacturing Industries (Overall Industry) and Sections - Last three months
Overall Industry and Sections Changes (%)
M/M-1 Cumulative in the year M/M-12
SEP/21 OCT/21 NOV/21 SEP/21 OCT/21 NOV/21 SEP/21 OCT/21 NOV/21
General Industry 0.25 2.26 1.31 23.90 26.69 28.36 30.40 28.95 28.86
B - Mining and Quarrying Industries -16.48 -2.18 -5.21 40.72 37.66 30.49 49.71 33.48 29.17
C - Manufacturing Industries 1.61 2.55 1.73 22.92 26.06 28.23 29.29 28.67 28.85
Source: IBGE, Diretoria de Pesquisas, Coordenação de Indústria

The cumulative indicator in the year was 28.36% against 26.69% in October 2021. Among the activities with the biggest changes were:  oil refining and ethanol products (71.04%), other chemicals (60.03%), basic metals (46.45%) and wood (38.51%). The sectors responsible for the biggest contributions were: oil refining and ethanol products (5.99 p.p.) other chemicals (4.81 p.p.), food products (3.99% p.p.) and basic metals (3.04 p.p.).

The cumulative index in 12 months was 28.86% against 28.95% in October 2021. The four biggest price changes were recorded in oil refining and ethanol products (80.13%), other chemicals (60.69%),  basic metals (48.87%) and wood (39.77%). The sectors responsible for the biggest contributions were: oil refining and ethanol products (6.44 p.p.) other chemicals (4.86 p.p.), food products (3.73% p.p.) and basic metals (3.15 p.p.).

The change of 1.31% from October reflected in the major economic categories in the following way: capital goods, 1.19%; intermediate goods, 1.40%; and consumer goods, 1.18%, with 0.64% being the change observed in durable consumer goods and 1.29% in semi and non-durable consumer goods.

The influence of the economic categories on the month’s result  (1.31%) was: capital goods, 0.08 p.p; intermediate goods, 0.82 p.p and  consumer goods, 0.41 p.p. In the case of consumer goods, 0.04 p.p. was due to price changes of durable consumer goods and 0.37 p.p. of semi and non-durable consumer goods.

The cumulative index in the year recorded a change of 28.36%, with 19.03% from capital goods (influence of 1.38 p.p.), 35.53% from intermediate goods (19.79 p.p.) and 19.41% from consumer goods (7.18 p.p.). In this last case, the result was influenced by durable consumer goods (0.93 p.p.) and by semi and non-durable consumer goods (6.25 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
SEP/21 OCT/21 NOV/21 SEP/21 OCT/21 NOV/21 SEP/21 OCT/21 NOV/21
General Industry 0.25 2.26 1.31 23.90 26.69 28.36 30.40 28.95 28.86
Capital Goods (BK) 1.29 1.85 1.19 15.50 17.63 19.03 17.30 16.43 17.71
Intermediate Goods (BI) -0.55 3.03 1.40 29.72 33.65 35.53 38.99 36.32 36.21
Consumer Goods (BC) 1.42 1.04 1.18 16.79 18.01 19.41 20.57 20.39 20.03
Durable Consumer Goods (BCD) 0.55 1.36 0.64 12.78 14.32 15.05 15.87 16.28 16.01
Semi and Non-durable Consumer Goods (BCND) 1.59 0.98 1.29 17.59 18.75 20.28 21.52 21.22 20.84
Source: IBGE, Diretoria de Pesquisas, Coordenação de Indústria

In the November 2021/November 2020 comparison, the industrial prices rose 28.86%, with the following changes: capital goods, 17.71% (1.31 p.p.); intermediate goods, 36.21% (20.15 p.p.); and consumer goods, 20.03% (7.41 p.p.), being the influence of durable consumer goods of 0.98 p.p. and that of semi and non-durable consumer goods, of 6.42 p.p.

Mining and quarrying industries: the prices of this sector changed -5.21% in November, the third consecutive month of negative changes, which accumulated a drop of -22.56%. This sector stood out due to the fact that it was the second most intense negative change in the monthly indicator and the third influence in the same perspective (-0.31 p.p. in 1.31%). The cumulative index along the year was 30.49%. In the accumulated of 12 months, the change was of 29.17%. It is worth noting that the cumulative index in the year was 68.49% up to August.

In November, the price of the two products with the highest weight in this sector (“crude petroleum oil” and “iron ores and their concentrates, crude or processed, except pelleted or sintered”) recorded their first negative changes this year. The price of “iron ores and their concentrates, crude or processed, except pelleted or sintered” dropped in the three most recent months, whose rates were negative.

Food products: the prices of food products changed, on average, -0.15% in November, the second negative figure in the year and the first one after June (-0.14%). In the cumulative index, the November´s figure retreated from 15.70% to 15.53%, remaining above 15% and above the rate of 10% noticed since July 2021 (10.06%). In the cumulative index in 12 months, the change of 14.31% was the lowest one in the year. More than that, it was the lowest one since February 2020 (11.94%).

This sector exerted the third biggest influence both in the cumulative index in the year (3.99 p.p. in 28.36%) and in the cumulative rate in 12 months (3.73 p.p. in 28.86%).

In terms of influence, “sterilized milk/UHT/long life milk”, “frozen beef” and “frozen poultry and giblets” stood out, which was in line with the behavior of the market, highlighting the period of bigger acquisition of milk, the restrictions still faced by the Brazilian beef in the Chinese market and the warm demand of chicken. On the other hand, the low supply has boosted the price of sugarcane products, like “crystallized sugar”.

The four products that mostly influenced the month´s figure accounted for -0.21 p.p. in -0.15%, which meant that the other 39 products exerted a net positive influence of 0.06 p.p.

As the biggest impact of this sector on the overall index was in the cumulative index in the year and in 12 months, it is worth noticing that five products stood out with positive changes: “VHP sugar (very high polarization)”, “fresh or cooled beef”, “crystallized sugar”, “crude degummed soybean oil” and “frozen poultry and giblets”.

Among the groups, the negative changes in the monthly indicator occurred in “slaughter and manufacture of meat products” (-1.72%), “dairy products” (-3.40%), “milling, manufacture of starchy products and animal food” (-0.28%). Therefore, those were the results that led the change to the negative side. In the other indicators, “manufacture and refining of sugar” (33.06% in the cumulative index in the year; 29.50%, in the M/M-12) and “roasting and grinding of coffee” (65.82% in the cumulative index in the year; 67.03% in the cumulative indicator in 12 months) were the only sectors whose prices changed above the average: 15.53% in the cumulative rate in the year; 14.31% in the cumulative index in 12 months.

Oil refining and ethanol products: the prices of this sector changed, on average, 6.63% in November. The last negative figure in this comparison was registered in April 2021 (-0.55%), the only one in the year. However, the average change was 1.80% between May and September 2021, against 7.15% in October and 6.63% in November. The cumulative index in the year changed from 60.40% in October to 71.04% in November. The cumulative rate in 12 months increased by 8.09 p.p. between the October´s rate (72.04%) and that of November (80.13%). The annual figure in November was the third highest in the time series, losing only to those reported in April 2021 (91.25%) and May 2021 (106.57%).

The positive changes in the prices of this sector were the most intense among all the industrial activities. In addition, the three indicators exerted the biggest influence on the overall result: 0.71 p.p. in 1.31% in the monthly indicator; 5.99 p.p. in 28.36% in the cumulative index in the year; and 6.44 p.p. in 28.86% in the cumulative rate in 12 months.

Other chemicals: having exerted the second highest positive change in the IPP prices (4.90%), the chemical industry accumulated a change of 60.03% in the year and of 60.69% in the last 12 months, mainly due to the change in the foreign prices of several raw materials, either imported or not, like, for instance, naphtha. Also, the demand of the industry for chemicals was on an upward trend.  Considering a detailed analysis of the groups accounting for this increase, there is a concentration in “manufacture of inorganic chemicals”, more specifically manure/fertilizers, being the main reasons the significant increases of urea, lower production of fertilizers in the foreign market and appreciation of the dollar over the real in the last five months of the year (10.4%). The price change in this group was of 7.12% in the month, accruing a change of 113.05% in the year and of 110.63% in the last 12 months. Both the cumulative indexes were the highest ones in the entire time series.

The group of “manufacture of resins and elastomer” recorded a change of 4.26%, the third consecutive positive change, thus accruing 43.21% in the year and 46.48% in the last 12 months. Finally, in the group “manufacture of pesticides and household disinfectants”, the result was 3.97% in the month, a cumulative rate of 17.57% in the year and a cumulative figure of 16.93% in 12 months.

The four products that most influenced the result (2.96 p.p. in 4.90%) increased their prices, with two in the group of inorganic chemicals, "NPK-based fertilizers or manure" and "manure or mineral or chemical fertilizers, phosphate-based”.  The others represented the groups previously highlighted, “herbicides for agricultural use “ and “vinyl poly chloride (PVC)”. The other 35 products surveyed in this activity also had, on the average, a positive result with 1.94 p.p. of the final change of the activity.

Those that mostly influenced the results in the cumulative indexes in the year and in 12 months were all positive and the same ones: “NPK-based manure or fertilizers”, “mineral or chemical phosphate manure or fertilizers”, “polypropylene (PP)” and “unsaturated propane (propylene)”.

This sector stood out as the third biggest price change this month and the second one in the cumulative indexes in the year and in 12 months. Furthermore, in terms of influence, it was the second biggest in the month (0.47 p.p. in 1.31% of the general index) and repeated the position in the cumulative index in the year (4.81 p.p. in 28.36%).  In terms of the cumulative index in 12 months the index hit 4.86 p.p. in 28.86%.

Basic metals: the comparison between the prices of the sector of basic metals in November and October showed a change of -0.31%, breaking a row of 16 positive changes in the activity. With this result, the sector of basic metals accumulated a change of 46.45% in the year and of 48.87%, in the last 12 months.  Between December 2018 (base for the current sample) and November 2021, the prices of the sector had a cumulative increase of 93.46%, only second to the cumulative increase of mining and quarrying industry, 116.04%, activity that includes iron ore, main raw material for steel, and virtually matching with the activity of petroleum refining and biofuels (94.44%).

Considering the economic groups of this activity, the steel group registered a negative change for the second time in a row (-3.67%), the most intense in the entire IPP time series started in January 2019, mainly due to the drop in the prices of iron ore. The economic group of steel accumulated 51.86% in the year and 56.21% in 12 months. The last two figures were above the average for the activity.

The four products that mostly influenced the monthly change accounted for -0.69 p.p. of -0.31%, with 0.38 p.p. for the other 20 products surveyed. Three out of four products that mostly influenced the monthly results recorded negative changes. They are based on steel, influenced, as previously mentioned, by the drop in the prices of iron ore in the market.

The basic metals sector stood out as the third biggest price change in the cumulative indexes in the year and in 12 months. In terms of influence, it was the fourth in the cumulative indicator in the year (3.04 p.p. in 28.36%) and in the cumulative rate in 12 months (3.15 p.p. in 28.86%).

Fabricated metal products: this sector posted an average price increase of 2.49%, the highest figure since July this year (when it changed 2.50%) and the fourth biggest influence on the monthly indicator among all the sectors of the mining and quarrying and manufacturing industries surveyed, with 0.07 p.p. in 1.31% of the overall industry.

The products that mostly influenced the monthly result were “aluminum cans for packaging”, “metallic laminates cut in any format”, “iron and steel structures, in plates or in other formats” and “iron and steel squarenesses”. The increase noticed in these products are mainly explained by the higher prices of their inputs, like, for example, aluminum and steel (despite the drop in the steel group in November, it accumulated a rise of 56.21% in the last 12 months. These four products together added up to 2.02 p.p. in the monthly figure (2.49%). In other words, the other 21 products of this activity contributed with 0.47 p.p.

This sector accumulated a change of 37.56% in 2021, the highest figure in the time series for a cumulative index in the year, not only for November, but also for any month surveyed. As a comparison, the average cumulative change in the first 11 months of the year was 5.23% from the beginning of the time series in 2010 up to 2020. Comparing November 2021 with November 2020, this sector accrued a change of 37.58%, the fourth highest figure in the time series, only behind other months of 2021: August (39.90%), September (39.11%) and July (38.50%).