June 2004 U.S. Import and Export Price Indexes

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- JUNE 2004 -

The U.S. Import Price Index declined 0.2 percent in June, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. The decrease was the first since September 2003 and was led by lower petroleum prices. Export prices also decreased in June, falling 0.6 percent. The decline in export prices was the first since last July and the largest drop since October 2001.

Import Goods

Import prices fell 0.2 percent in June following a 1.4 percent increase the previous month. Prices for petroleum fell 1.0 percent last month after rising 9.4 percent in May, the largest monthly gain for the index since February 2003. Prices for petroleum imports were up 34.3 percent over the past year. Nonpetroleum import prices were unchanged in June 2004, the first month since October 2003 that these prices did not increase. For the year ended in June, prices for nonpetroleum imports were up 2.4 percent and overall import prices rose 5.6 percent.

The price index for import foods, feeds, and beverages fell 0.5 percent in June, led by lower prices for vegetables and fruits. Foods, feeds, and beverages prices rose 5.6 percent over the past 12 months. Prices for capital goods and for nonpetroleum industrial supplies and materials also decreased in June, each declining 0.1 percent. Lower computer prices and the recent appreciation of the U.S. dollar both contributed to the fall in capital goods prices. The decrease in prices for nonpetroleum industrial supplies and materials was led by downturns in the price indexes for both building materials and unfinished metals. For the year ended in June, prices for capital goods fell 1.4 percent, whereas nonpetroleum industrial supplies and materials prices were up 11.8 percent.

In contrast, prices for automotive vehicles rose 0.2 percent in June. The price index for automotive vehicles has not posted a decline since September and was up 1.6 percent over the past 12 months.

Consumer goods prices were unchanged in June and were up 0.4 percent for the June 2003-2004 period.

Export Goods

Export prices fell 0.6 percent in June, as both agricultural and nonagricultural prices contributed to the decline. The price index for agricultural exports fell 4.6 percent in June, marking the first monthly decline since August 2003 and the largest decrease since September 1996. A downturn in soybean prices led the fall in agricultural prices, although widespread declines in the prices of other grains and vegetables also contributed to the overall decrease. Nonagricultural prices fell in June by 0.1 percent. The index had not posted a decline since September and was up 2.9 percent for the year ended in June. Overall export prices increased 4.0 percent over the same period.

The drop in nonagricultural prices was led by a 0.6 percent decrease in the index for nonagricultural industrial supplies and materials. Downturns in metals and fuel prices contributed to the decline. Nonagricultural industrial supplies and materials prices had increased in each of the last 10 months and were up 9.7 percent over the past year.

Prices for each of the major finished goods categories were unchanged in June. The price indexes for capital goods and for consumer goods also were unchanged in May but were up 0.5 percent and 0.8 percent, respectively, over the past 12 months. Automotive vehicle prices increased a modest 0.1 percent in May and were up 0.7 percent for the year ended in June.

Imports by Locality of Origin

Prices for imports from Japan fell 0.3 percent in June after rising 0.2 percent in May. The decline paralleled the recent appreciation of the U.S. dollar against the Japanese yen. Import prices from Japan were up 0.8 percent over the past 12 months.

Import prices from the Asian Newly Industrialized Countries were unchanged in June after ticking up 0.1 percent the previous month. For the year ended in June, the index fell 0.7 percent.

Prices for imports from Latin America fell 0.5 percent in June, which was the first monthly decline for the index since September 2003. Despite the June decrease, import prices from Latin America rose 9.3 percent over the year.

Import prices from Canada and from the European Union both were unchanged in June. Prices of imports from Canada were up 8.4 percent for the year ended in June, and import prices from the European Union increased 5.4 percent over the same period.

Import and Export Services

Import air passenger fares rose 9.7 percent in June after a modest 0.9 percent rise in the previous month. The June increase was led by higher seasonal rates for both European and Asian fares. For the year ended in June, overall import fares rose 0.7 percent. Export air passenger fares rose at a more moderate 0.2 percent in June and were up 5.8 percent over the past 12 months.

The price index for import air freight rose 0.3 percent for the March- June quarter and was up 5.3 percent for the year ended in June. Export air freight was up for the third consecutive quarter, rising 2.1 percent for the second quarter of 2004. Over the past 12 months, the index rose 4.1 percent.