August 2004 U.S. Import and Export Price Indexes

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- AUGUST 2004 -

The U.S. Import Price Index rose 1.7 percent in August, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Higher prices for both petroleum and nonpetroleum imports contributed to the overall increase. In contrast, August export prices fell 0.5 percent as lower prices for agricultural exports more than offset an increase in nonagricultural export prices.

Import Goods

Import prices increased 1.7 percent in August, the tenth increase in the past eleven months and the largest monthly rise for the index since February 2003. The increase was again led by higher petroleum prices, up 9.6 percent in August and 40.4 percent over the past year. The August price index for petroleum imports was at its highest level since publication began in 1982. Nonpetroleum prices also contributed to the overall increase in import prices, rising 0.4 percent last month and marking the largest gain for that index since rising the same amount in February. Prices for nonpetroleum imports had been unchanged in July and were up 3.2 percent for the year ended in August. Overall import prices rose 7.2 percent over the same period.

The increase in nonpetroleum prices was primarily attributable to a 2.0 percent advance in the price index for nonpetroleum industrial supplies and materials. Higher prices for lumber, metals, chemicals, and natural gas all contributed to the increase. Nonpetroleum industrial supplies and materials prices have risen in each of the past ten months and were up 16.3 percent for the August 2003-2004 period. The price index for foods, feeds, and beverages rose a modest 0.1 percent in August and was up 5.9 percent over the past 12 months.

In contrast, prices for each of the major finished goods categories posted no change in August. Capital goods prices remained unchanged as a drop in computer prices was offset by higher prices for capital goods excluding computers. Lower computer prices continued to put downward pressure on capital goods prices, which fell 1.5 percent over the past year. The price indexes for automotive vehicles and consumer goods were up over the past 12 months, rising 1.6 percent and 0.6 percent, respectively.

Export Goods

Overall export prices fell 0.5 percent in August, the second decline in the past three months following an upward trend since September 2003. The August decline was driven by an 8.5 percent decrease in agricultural prices, the third consecutive decline for that index and the largest one-month decrease since monthly publication began in 1989. Sharp drops in soybean and corn prices were the largest contributors to the decline. Despite the recent decreases, the price index for agricultural prices was up 6.1 percent over the past 12 months. Nonagricultural prices were up 0.4 percent in August. Prices for nonagricultural exports and overall exports each rose 3.9 percent over the past year.

Nonagricultural industrial supplies and materials prices increased 0.8 percent in August, continuing the upward trend for this index over the past year. Rising prices for chemicals, metals, and fuel all contributed to the upward movement in the index, which rose 13.1 percent for the year ended in August.

The price indexes for each of the finished goods categories posted modest increases for the second consecutive month. Prices for capital goods and for automotive vehicles both were up 0.1 percent in August, the same as in July. Capital goods prices rose 0.3 percent over the past year, while prices for automotive vehicles were up 0.8 percent. Consumer goods prices increased 0.2 percent in August following a 0.5 percent rise in July and were up 1.7 percent over the past year.

Imports by Locality of Origin

Prices for imports from Latin America and from the European Union were up in August, led by rising prices for petroleum products. Import prices from Latin America rose 2.5 percent, the largest monthly increase for the index since February 2003, and were up 11.2 percent for the year ended in August. The price index of imports from the European Union advanced 0.8 percent in August and 6.1 percent over the past 12 months.

Import prices from Canada rose 2.2 percent in August, continuing the recent upward trend. The August increase was the largest since February, and the index was up 10.8 percent over the past year.

Prices for imports from Japan rose a modest 0.1 percent last month after a 0.2 percent advance in July. Over the past 12 months, the price index of imports from Japan was up 1.3 percent.

In contrast, import prices from the Asian Newly Industrialized Countries were unchanged in August and were down 0.7 percent over the past year.

Import and Export Services

Import air passenger fares declined 0.3 percent in August, following four consecutive monthly increases. The index was down 2.7 percent for the year ended in August. In contrast, export air passenger fares increased 7.7 percent in August, led by a 21.8 percent increase in Asian fares. The increase in export air passenger fares was the third consecutive monthly advance, and the index rose 9.3 percent for the year ended in August.