December 1999 U.S. Import and Export Price Indexes

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- DECEMBER 1999-

The U.S. Import Price Index increased 0.7 percent in December, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. The increase--the sixth in a row--was attributable to ongoing increases in petroleum prices. Prices for nonpetroleum imports were unchanged in December. Export prices edged up 0.1 percent in December, the same as in November.

Over the past year, import prices rose 7.0 percent after falling 6.4 percent in 1998 and 5.2 percent in 1997. The 1999 annual increase was the largest recorded for the index since 1990. Import prices excluding petroleum, however, were unchanged for the year.

Export prices also increased over the past year, up a more modest 0.5 percent. The calendar year increase in export prices was the first recorded since 1995.

Import Goods

The petroleum index, which has increased for 10 consecutive months, continued to lead the upswing for overall import prices. In December, petroleum prices rose 6.0 percent and were at their highest level since January 1991. Over the past 12 months, the petroleum index rose 132.9 percent. This increase followed double-digit decreases in each of the previous two years and was more than double the largest annual increase previously recorded--48.7 percent in 1990. (Publication of this series began in 1983.) The increase in the import price index was moderated by prices for nonpetroleum imports, which were unchanged, on average, in December, after increasing 0.4 percent in November. Over the past 12 months, the nonpetroleum import index was unchanged after decreasing in each of the previous three years.

Within the nonpetroleum import index, price gains that were recorded for foods, feeds, and beverages and industrial supplies and materials were offset by a dip in prices for all the major finished goods areas. The price index for industrial supplies and materials excluding petroleum increased, although more modestly, for the eighth consecutive month, advancing 0.2 percent in December. For the year ended in December, the index rose 5.4 percent after decreasing in each of the previous three years. The index for foods, feeds, and beverages continued a recent upturn, rising 2.3 percent in December after gaining 1.4 percent in November, as coffee prices rose 18.8 percent and 14.0 percent over the past two months. Despite the recent gains, the index for foods, feeds, and beverages dipped 0.3 percent for the year.

In contrast, indexes for the three major finished goods categories-- capital goods, consumer goods, and automotive vehicles-- each edged down 0.1 percent in December. Capital goods prices have dipped 0.1 percent for three consecutive months, while prices for both consumer goods and automotive vehicles were unchanged in November. The indexes for capital goods and consumer goods have decreased in each of the past four years. The index for automotive vehicles, parts, and engines, however, rose 0.6 percent for the year ended in December.

Export Goods

Prices for overall exports rose 0.1 percent for the second consecutive month, as increases for nonagricultural prices more than offset declines in agricultural prices. The export price index increased 0.5 percent for the year ended in December, after decreasing in each of the prior three years. Agricultural prices fell 1.0 percent in December-- largely attributable to a drop in grain prices-- continuing the downward trend over the previous three months. On an annual basis, the index fell for the fourth consecutive year, down 7.1 percent for the December 1998-99 period. In contrast, prices for nonagricultural exports continued to post modest increases, rising 0.1 percent in December. The December advance followed slightly larger increases of 0.3 percent and 0.4 percent in November and October, respectively. Prices for nonagricultural exports were up 1.4 percent for the year ended in December, compared with the declines recorded for each of the previous three years.

Price increases for nonagricultural industrial supplies and materials led the modest advance in nonagricultural export prices, increasing 0.5 percent in December, after increasing 1.0 percent and 0.9 percent in November and October, respectively. For the year, prices for nonagricultural industrial supplies and materials increased 6.1 percent after three consecutive annual declines. In addition, prices for consumer goods excluding automotives edged up 0.1 percent for the second consecutive month and were up 0.6 percent for the year. Prices for exported automotive vehicles were unchanged for the second month in a row. Over the past 12 months, the index rose 1.2 percent.

In contrast, the index for capital goods decreased 0.1 percent in December and 0.9 percent over the December 1998- 99 period, marking the third consecutive annual decline.

Summary of December-to-December percent changes

Imports by Locality of Origin

The price index for imports from Japan rose for the fifth consecutive month, up 0.4 percent in December. Over the past year, the index rose 1.6 percent, the first annual increase over the past four years.

Prices of imports from the Asian Newly Industrialized Countries increased 0.1 percent in December after decreasing 0.4 percent the previous month. The index declined for the fourth consecutive year, falling 1.1 percent for the December 1998-99 period.

Led primarily by ongoing price increases for petroleum products, the import price indexes for Canada and Latin America increased for the 10th and 6th consecutive month, respectively. Import prices from Latin America were up 1.2 percent in December and 16.7 percent over the past 12 months. Canadian import prices increased 0.3 percent last month and 6.6 percent for the year.

In contrast, the index for imports from the European Union was down last month, falling 0.3 percent, the first decline in this index since July. Over the past 12 months, the index rose 0.6 percent.

Import and Export Services

The import air freight index increased 2.2 percent from September to December, following a third-quarter increase of 1.9 percent. For the year ended in December, the index rose 2.5 percent. In contrast, the export air freight index decreased 1.7 percent for the second consecutive quarter. Over the past 12 months, this index fell 9.2 percent.

The import air passenger index dropped 9.8 percent from September to December. For the year ended in December, however, the index gained 1.2 percent as gains posted in the second and third quarters more than offset the recent decline. The export air passenger index also was down over the past three months, falling 2.0 percent in the fourth quarter. Despite the recent decline, this index rose 5.9 percent over the past year.

The import ocean liner freight index decreased 3.9 percent over the past three months, after posting large gains in the previous two quarters. The index rose 28.3 percent over the past 12 months.