March 1996 Producer Price Index

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.

The Producer Price Index for Finished Goods advanced 0.5 percent in March, seasonally adjusted, the Bureau of Labor Statistics of the U. S. Department of Labor reported today. This followed a 0.2 percent decline in February and a rise of 0.3 percent in January. Prices received by domestic producers of intermediate goods moved up 0.2 percent in March, after falling 0.4 percent in the previous month. The Crude Goods Price Index increased 1.6 percent after declining 0.7 percent in February. (See table A.)

Among finished goods in March, prices for both energy goods and foods turned up after falling in February. The index for finished goods other than foods and energy inched up 0.1 percent for the second consecutive month.

incorporate late reports and corrections by respondents. All indexes are subject to revision 4 months after original publication. During the first quarter of 1996, the Finished Goods Price Index moved up at a seasonally adjusted annual rate of 2.8 percent, following a 4.1 percent rate of increase during the fourth quarter of 1995. The index for finished energy goods advanced at an 18.4 percent annual rate from December 1995 to March 1996 after rising at a 10.3 percent annual rate over the last 3 months of 1995. The index for finished consumer foods inched up at a 0.3 percent annual rate from December to March after advancing at a 4.4 percent rate during the fourth quarter of 1995. The rate of increase for the finished goods index less foods and energy was 0.6 percent in the first quarter of 1996 compared with 2.9 percent in the fourth quarter of 1995. Prices for capital equipment were unchanged after rising in the previous quarter, prices for consumer nondurables less foods rose somewhat more rapidly than in the final quarter of 1995, while prices for consumer durables turned down slightly after rising in the previous quarter.

Before seasonal adjustment, the Producer Price Index for Finished Goods increased 0.6 percent in March to 130.2 (1982 =100). From March 1995 to March 1996, the Finished Goods Price Index rose 2.4 percent. During this same period, consumer food prices increased 2.6 percent, the index for finished energy goods advanced 4.3 percent, and prices for finished goods less foods and energy were up 1.9 percent. Prices received by domestic producers of intermediate goods increased 0.7 percent during the 12 months ended in March 1996, and crude material prices rose 6.6 percent over the same period.

1996 Jan. 0.2 2.9 -0.3 2.2 -0.4 7.3 0 5.5

Feb. -0.5 -1.3 -0.2 1.1 -0.5 -1.1 -0.5 4.2 Mar. 0.2 2.1 -0.2 0.7 0.1 5.9 -1.8 6.6 r=revised. Some percent changes shown here and elsewhere in this release may differ from those previously reported because indexes for November 1995 have been recalculated to incorporate late reports and corrections by respondents. All indexes are subject to revision 4 months after original publication.

Finished goods

The Producer Price Index for finished energy goods increased 2.4 percent in March following a decrease of 0.7 percent in February. Prices for gasoline rose 7.1 percent in March following a 4.2 percent decline in February. Prices for residential power also turned up after falling a month earlier. Price increases for home heating oil accelerated from 0.6 percent in February to 10.5 percent in March. By contrast, prices for residential natural gas increased 1.4 percent after rising 1.9 percent in the previous month. The index for finished lubricants edged down after advancing in the previous month.

Prices for finished consumer foods increased 0.6 percent in March after decreasing 0.3 percent in February. The March rise was led by a large increase of 43.1 percent in fresh and dry vegetables prices; those prices declined 5.1 percent in the prior month. Prices for finfish and shellfish, eggs for fresh use, soft drinks, dairy products, and processed turkeys also rose after falling in February. The index for pasta products moved up after showing no change in the previous month. By contrast, beef and veal prices fell 5.1 percent in March following a 1.4 percent decline in February. The indexes for processed young chickens and milled rice also fell more than in February. The indexes for fresh fruits and melons and bakery products fell after rising in February. Price increases for pork slowed from February to March.

In March, the index for consumer goods less foods and energy moved up 0.1 percent, the same as in February. This index increased at a seasonally adjusted annual rate of 0.6 percent from December 1995 to March 1996 after rising at a rate of 3.1 percent in the fourth quarter of 1995. In March, increases were registered for alcoholic beverages, home electronic equipment, footwear, floor coverings, passenger cars, and light trucks. These advances more than offset declines for sanitary papers and health products, girls' apparel, household flatware, toys, and tires and tubes.

In March, the capital equipment index turned down 0.1 percent after rising 0.1 percent in February. The index for commercial furniture declined 0.5 percent after rising 0.4 percent in the previous month. Prices for communication and related equipment and for office and store machines and equipment also turned down after rising a month ago. The index for electronic computers fell more than in February. Prices for agricultural machinery and equipment rose less than a month earlier, and the index for construction machinery and equipment remained unchanged after rising in February. By contrast, the index for light motor trucks turned up 0.4 percent after declining 0.3 percent in the previous month. Prices for civilian aircraft remained unchanged after a slight February decline.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components increased 0.2 percent in March, seasonally adjusted, following a decline of 0.4 percent a month earlier. During the first quarter, this index fell at a 0.6 percent seasonally adjusted annual rate after increasing at a 0.3 percent rate in the fourth quarter of 1995. In March, prices for energy goods, construction materials, and for foods and feeds turned up after falling in the previous month. The index for durable manufacturing materials fell less than in February. By contrast, the index for nondurable manufacturing materials decreased more than a month earlier. Excluding food and energy prices, this index fell 0.2 percent, the sixth straight monthly decline. (See table B.)

The index for intermediate energy goods turned up 2.1 percent after falling 1.3 percent in February. These prices rose at a 15.9 percent seasonally adjusted annual rate over the previous three months after increasing at a 14.9 percent rate from September to December. In March, the index for gasoline turned up 7.1 percent after falling 4.2 percent in the previous month. Prices for jet fuels, residual fuel, diesel fuel, commercial electric power, and industrial electric power also increased after declining a month earlier. In addition, the index for commercial natural gas rose more than in February. The index for liquefied petroleum gas, however, turned down 2.8 percent after rising 6.5 percent a month ago.

The index for durable manufacturing materials fell 0.2 percent after decreasing 0.8 percent a month earlier. Durable manufacturing material prices fell at a 7.0 percent seasonally adjusted annual rate from December to March, slightly less than the 7.7 percent rate of decline in the fourth quarter of 1995. In March, the index for aluminum mill shapes turned up 0.3 percent after falling 2.0 percent a month earlier. Prices for copper and brass mill shapes, copper, and prepared paint also rose after declining in the previous month. The index for cold rolled steel sheet and strip fell less than in February. By contrast, the index for hot rolled steel bars turned down 1.4 percent after rising 0.1 percent a month ago. Prices for flat glass and cement also declined after increasing in the previous month. The index for plywood fell after remaining unchanged a month earlier.

The index for intermediate foods and feeds rose 0.2 percent in March after declining 0.5 percent a month earlier. This index declined at a 0.3 percent seasonally adjusted annual rate during the first quarter after increasing at a 28.6 percent rate in the fourth quarter of 1995. In March, the index for prepared animal feeds turned up 1.5 percent following a decline of 0.2 percent in the previous month. Prices for fluid milk products and refined sugar also increased after falling a month ago. The index for liquid milk products fell less than in February. Conversely, the index for flour turned down 1.0 percent in March after surging 5.8 percent in the previous month. Prices for beef and veal and crude vegetable oils fell more than a month earlier. In addition, the index for pork rose less than in the previous month.

The index for construction materials rose 0.2 percent after remaining unchanged in February. From December to March, prices for construction materials fell at a 0.6 percent seasonally adjusted annual rate after declining at a 3.0 percent rate from September to December. In March, the rise in the index for softwood lumber accelerated to 2.4 percent from 0.6 percent in the previous month. Prices for concrete products also rose more than a month earlier. Indexes for nonferrous wire and cable, wiring devices, and for air conditioning and refrigeration equipment turned up after falling a month ago. On the other hand, the index for plastic construction products turned down 0.9 percent after rising the same amount in the previous month. Prices for plywood fell after remaining unchanged in February, and the index for gypsum products decreased more than a month earlier.

The index for nondurable manufacturing materials fell 0.8 percent in March after a 0.6 percent decline in the previous month. This index fell at a 7.8 percent seasonally adjusted annual rate from December to March after decreasing at an 8.5 percent rate in the preceding three months. In March, the index for miscellaneous basic organic chemicals turned down 0.6 percent after increasing 1.5 percent in February. Prices for alkalies and chlorine also fell after rising in the previous month. The index for paper fell more than a month ago, and prices for phosphates rose less than in the prior month. The decline in the index for plastic resins and materials, however, slowed to 0.2 percent from 1.4 percent in February. Prices for medicinal and botanical chemicals and for both primary and intermediate basic organic chemicals turned up after falling a month earlier. Crude goods

The Producer Price Index for Crude Materials for Further Processing increased 1.6 percent, seasonally adjusted, in March, after falling 0.7 percent last month. In the first quarter of 1996, this index rose at a seasonally adjusted annual rate of 12.8 percent, after increasing at a rate of 7.6 percent in the last quarter of 1995. In March, prices for both crude energy materials and crude foodstuffs and feedstuffs turned up after declining in the prior month. By contrast, the basic industrial materials index fell more rapidly than in February. (See table B.)

The index for crude energy materials turned up 5.9 percent in March after declining 1.1 percent in the previous month. This index increased at an annual rate of 59.9 percent from December 1995 to March 1996, following a 15.7 percent rate of increase in the previous quarter. In March, prices for crude petroleum rose 8.5 percent after declining 5.2 percent in the prior month. The increase in natural gas to pipelines prices accelerated to 5.9 percent in March from 0.5 percent in the previous month. Price increases for coal slowed in March.

After declining 0.5 percent in February, prices for crude foodstuffs and feedstuffs increased 0.1 percent, seasonally adjusted, in March. This index fell at a seasonally adjusted annual rate of 3.4 percent in the first quarter, after an increase of 20.4 percent in the fourth quarter of 1995. In March, prices for fresh vegetables, except potatoes rose 69.6 percent after a 10.8 percent drop in February. The index for slaughter hogs also advanced after declining a month earlier. The index for slaughter broilers fell less than in the prior month. By contrast, prices for fluid milk fell 0.6 percent in March after rising 1.9 percent in the previous month. The indexes for Irish potatoes for processing and slaughter turkeys also declined after rising in February. Prices increases for wheat slowed in

March.

The index for crude nonfood materials less energy fell 1.8 percent, seasonally adjusted, in March, following a 0.5 percent decline in February. Following a 19.6 percent decline in the fourth quarter of 1995, this index fell at a seasonally adjusted annual rate of 8.8 percent in the first quarter of 1996. Prices for leaf tobacco declined 15.7 percent in March, after an increase of 11.1 percent in February. Indexes for iron and steel scrap, wastepaper, and gold ores also turned down after rising in the previous month. Prices for raw cotton fell more rapidly than in February. By contrast, prices for copper ores turned up 1.9 percent following an 8.7 percent decline a month ago. The indexes for aluminum base scrap; softwood logs, bolts, and timber; and copper base scrap also rose after falling in February.

Net output price indexes for mining, manufacturing, and other industries

Mining. The Producer Price Index for the net output of total domestic mining industries increased 4.1 percent in March after declining 0.4 percent in February. (Net output price indexes are not seasonally adjusted.) This index advanced at an annual rate of 47.6 percent in the first quarter of 1996 after rising at a 16.7 percent annual rate from September to December. In March, prices turned up 5.5 percent after falling 0.8 percent a month earlier for the oil and gas extraction industry group index. The index for metal mining inched up after falling in each of the 3 previous months. By contrast, price increases for nonmetallic minerals mining slowed from 1.0 percent in February to 0.3 percent in March. Price increases also slowed for the bituminous coal and lignite mining industry group. In March, the Producer Price Index for total mining stood at 78.7 (December 1984=100), 11.3 percent higher than a year earlier.

Manufacturing. The Producer Price Index for total domestic manufacturing industries moved up 0.3 percent in March, after edging down 0.1 percent in February. This index rose at an annual rate of 2.6 percent from December to March, after rising at a 3.3 percent rate in the final quarter of 1995. In March, the index for the petroleum refining industry group advanced 6.2 percent following a 3.1-percent decline in the previous month. Prices also turned up after falling a month earlier for the industry groups for leather and leather products, nonmetallic mineral products, and fabricated metal products. Prices continued to rise modestly for the industry groups for textile mill products and transportation equipment. By contrast, prices turned down after rising or showing no change in February for the industry groups for electrical machinery, measuring instruments, rubber and plastic products, furniture and fixtures, and for food and kindred products. In March, the index for total manufacturing was 126.1 (December 1984=100), 2.2 percent higher than a year earlier.

Other. Among other industries, prices turned up after falling a month earlier for the industry groups for trucking except local, marine cargo handling, tugging and towing services, nonscheduled air transportation, airports and airport services, freight transportation arrangement, radio broadcasting, electric power utilities, nonferrous metal scrap collection, and advertising agencies. Prices fell less in March than in February for farm products warehousing and storage; water transportation of freight, not elsewhere classified; and for collection of materials other than metal and paper. Prices increased in March after showing no change a month earlier for offices and clinics of doctors of medicine.

By contrast, prices for waste paper collection decreased 9.0 percent, following a 0.3-percent decline in February. In March, price decreases were also larger than in February for scheduled air cargo transportation, operators of nonresidential buildings, and for medical laboratories. Prices turned down in March after rising or showing no change in February for local trucking without storage, deep sea domestic transportation of freight, refined petroleum pipe lines, telephone communications, real estate agents and managers, help supply services, and for truck rental and leasing. Prices were unchanged after rising in the previous month for courier services, except by air, and for cable and other pay television services.

Information in this news release will be made available to sensory impaired individuals upon request. Voice phone: 202-606-7828; TDD phone: 202-606- 5897; TDD Message Referral phone: 1-800-326-2577.