August 2018 U.S. Import and Export Price Indexes

Historical release narrative reproduced from the official public-domain source. Statistical tables, standard technical appendices, administrative material and attendance rosters are omitted; formatting is adapted for reading. Figures retain the release's historical context and may have been revised. Consult the linked source for the complete document.

U.S. import prices declined 0.6 percent in August, the U.S. Bureau of Labor Statistics reported today, following a 0.1-percent decrease the previous month. Falling prices for both fuel and nonfuel imports contributed to the August decline. Prices for U.S. exports edged down 0.1 percent, after decreasing 0.5 percent in July.

Imports

Import prices declined 0.6 percent in August, the largest monthly drop since the index fell 1.3 percent in January 2016. The August decrease followed a 0.1-percent decline in July and was only the third monthly drop over the past 12 months. Prices for U.S. imports advanced 3.7 percent from August 2017 to August 2018 and have not recorded a 12-month decline since October 2016. (See table 1.)

New Locality of Destination and Terms of Trade Data Available

New Locality of Destination export price indexes are available in table 8 and new Terms of Trade indexes by locality are available in table 9. For more information on the new index series, please see page 5.

Fuel Imports: Import fuel prices decreased 3.9 percent in August, the first decline for the index since a 2.6- percent drop in March and the largest monthly decline since a 6.8-percent decrease in February 2016. Petroleum prices declined 3.9 percent in August, after increasing in each of the previous 4 months, and natural gas prices fell 6.3 percent following an 18.0-percent increase in July. Despite the downturn in August, fuel prices rose 30.6 percent over the past 12 months. The price index for petroleum increased 33.0 percent for the year ended in August, and prices for natural gas decreased 11.7 percent over the same period.

All Imports Excluding Fuel: Nonfuel import prices edged down 0.1 percent in August, after decreasing 0.3 percent in each of the previous 2 months. In August, the decline was driven by falling prices for nonfuel industrial supplies and materials, although lower capital goods prices also contributed. In contrast, the price index for foods, feeds, and beverages advanced in August. Despite the downward trend over the past 3 months, nonfuel import prices increased 0.9 percent between August 2017 and August 2018. The increase was led by a 6.4-percent rise in nonfuel industrial supplies and materials prices over the 12-month period.

Nonfuel Industrial Supplies and Materials: The price index for nonfuel industrial supplies and materials fell 0.8 percent in August following a 1.1-percent decline the previous month. The August decrease was led by a 1.9-percent drop in unfinished metals prices and a 2.6-percent decline in building materials prices.

Finished Goods: Import prices for finished goods categories were mostly unchanged in August. The price index for capital goods edged down 0.1 percent, after recording no change in July. Prices for consumer goods and automotive vehicles recorded no change in August.

Foods, Feeds, and Beverages: Foods, feeds, and beverages prices advanced 0.4 percent in August following a 1.6-percent decline the previous month.

Exports

Prices for U.S. exports decreased 0.1 percent in August, after declining 0.5 percent in July. The July downturn was the first monthly drop since June 2017. In August, lower prices for nonagricultural exports more than offset higher agricultural prices. The price index for overall exports advanced 3.6 percent for the year ended in August and has not recorded a 12-month decline since a 0.2-percent decrease in November 2016. (See table 2.)

Agricultural Exports: The price index for agricultural exports rose 0.2 percent in August following a 5.2- percent decline the previous month. In August, higher prices for soybeans, wheat, and corn more than offset lower prices for meat, nuts, and fruit. Agricultural prices decreased 1.7 percent for the year ended in August, after increasing 1.7 percent between August 2016 and August 2017. Falling prices for soybeans, fruit, and meat all contributed to the decline over the past 12 months.

All Exports Excluding Agriculture: Nonagricultural export prices fell 0.2 percent in August, after recording no change in July. The August decrease was led by declining prices for nonagricultural industrial supplies and materials, consumer goods, and automotive vehicles. In contrast, the price index for capital goods advanced in August. Prices for nonagricultural exports increased 4.1 percent over the past year and have not recorded a 12-month decline since November 2016.

Nonagricultural Industrial Supplies and Materials: Prices for nonagricultural industrial supplies and materials decreased 0.6 percent in August following a 0.2-percent decline the previous month. The declines in August and July were both driven by lower metals prices. Despite the recent downturn, the index advanced 9.7 percent for the year ended in August.

Finished Goods: Finished goods prices were mixed in August. The price indexes for consumer goods and automotive vehicles each fell 0.1 percent. In contrast, capital goods prices advanced 0.2 percent in August, after ticking up 0.1 percent in July. The August increase was led by higher prices for electrical generating equipment.

Measures of Import and Export Prices by Locality

Imports by Locality of Origin: The price index for imports from China edged down 0.1 percent for the second consecutive month in August. Those were the first monthly declines for the index since a 0.3-percent drop in September 2017. Prices for imports from Japan recorded no change in August following a 0.2- percent increase in July and a 0.1-percent decrease in June. Import prices from Japan rose 1.0 percent over the past year, the largest 12-month advance since the index increased 1.0 percent between June 2016 and June 2017. The price index for imports from Canada fell 1.5 percent in August, after recording no change the previous month. The August decline was led by lower petroleum prices. Prices for imports from the European Union and Mexico each decreased 0.1 percent in August. (See table 7.)

Exports by Locality of Destination: Prices for exports to China edged down 0.1 percent in August following declines of 2.1 percent in July and 0.6 percent in June. Export prices to Japan declined for the third consecutive month in August, falling 0.4 percent, after decreasing 1.2 percent in July and 0.3 percent in June. The price index for exports to the European Union fell 0.2 percent in August following 0.1-percent drops in each of the previous 2 months. In August, the decline was led by a 0.2-percent decrease in manufactured goods prices. In contrast, prices for exports to Canada and Mexico each ticked up 0.1 percent in August. (See table 8.)

Terms of Trade Indexes: Terms of Trade indexes are based on the country, region, or grouping and measure the change in the purchasing power of exports relative to imports. The U.S. terms of trade index with China recorded no change in August following a 2.0-percent decline in July and a 0.6-percent drop in June. Both the July and June decreases were driven by falling export prices to China. The U.S. terms of trade index with Japan decreased 0.4 percent in August, after declining 1.3 percent the previous month. The index for U.S. terms of trade with the European Union decreased 0.2 percent in August, after edging down 0.1 percent in July. In August, the U.S. terms of trade index with Canada advanced 1.6 percent and with Mexico rose 0.2 percent. (See table 9.)

Import and Export Services

Imports: Import air passenger fares declined 8.8 percent in August, the largest decrease since a 10.6- percent drop in August 2017. Falling European, Asian, and Latin American/Caribbean fares all contributed to the drop in August 2018. Despite the August decline, import air passenger fares advanced 3.5 percent over the past year. Prices for import air freight decreased 0.6 percent in August and increased 3.0 percent over the past 12 months. (See table 10.)

Exports: The index for export air passenger fares fell 3.7 percent in August, after increasing 1.6 percent in July and 5.0 percent in June. The August downturn was driven by an 11.1-percent drop in European fares. Export air passenger fares fell 3.3 percent over the past 12 months, the largest over-the-year decline since a 5.8-percent drop in December 2017. Export air freight prices decreased 0.6 percent in August and rose 3.4 percent over the past year.

Import and Export Price Index data for September are scheduled for release on Friday, October 12, 2018 at 8:30 a.m. (EDT).

New Locality of Destination and Terms of Trade Data

Beginning with the August news release on September 14, the BLS introduced two new data series. Locality of Destination price indexes measure export prices based on the country, region, or grouping where items are exported. Terms of Trade indexes are based on the country, region, or grouping and measure the relative price for exports in terms of import prices and are defined as the all-export price index divided by the corresponding all-import price index. For more information on Terms of Trade indexes, please see "U.S. Import and Export Prices and the Terms of Trade" at www.bls.gov/opub/btn/archive/us-import-and-export- price-indexes-and-the-terms-of-trade.pdf.

The Locality of Destination price indexes are published at the all-export level and also include a breakdown by manufacturing industries and nonmanufacturing industries where possible. The countries, regions, or groupings for which indexes are published include the Industrialized Countries, the European Union, Latin America, the Pacific Rim, Canada, China, Germany, Japan, and Mexico. Indexes by manufacturing industries and nonmanufacturing industries are available for all countries and regions except Canada and Germany.

Terms of Trade indexes are available for all countries, regions, and groupings where both the import Locality of Origin price index and the export Locality of Destination price index are published. These include the Industrialized Countries, the European Union, Latin America, the Pacific Rim, Canada, China, Germany, Japan, and Mexico.

The first publication month for the data series for both Locality of Destination price indexes and the Terms of Trade indexes is December 2017.

In addition to the new indexes, the numbering of the tables in the Import and Export Price Index news release changed. Tables 1 through 7 remain the same, and the new Locality of Destination data are in table 8 and the new Terms of Trade data are in table 9. The previous table for Selected Transportation Services changed from table 8 to table 10.