November 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 0.4 percent in November, seasonally adjusted, the Bureau of Labor Statistics of U. S. Department of Labor reported today. This followed a 0.4-percent increase in October and a 0.2-percent rise in September. Prices received by domestic producers of intermediate goods rose 0.2 percent in November after registering no change in the prior month. The Crude Goods Price Index advanced 1.8 percent, which followed a 0.6-percent decline in October. (See table A.)

Among finished goods in November, increases in the indexes for finished energy goods and for finished goods less foods and energy offset a decline in the index for finished consumer foods. Prices for finished goods less foods and energy turned up 0.1 percent after falling 0.3 percent in the prior month.

Change in Except finished Inter- goods foods from 12 mediateCrude and months Month Total Foods Energy energy ago goods goods (unadj.) 1995 Nov. 0.3 1.1 -1.0 0.4 2.1 -0.1 1.6 Dec. 0.6 0.1 3.8 0.1 2.3 0.2 1.6

Before seasonal adjustment, the Producer Price Index for Finished Goods registered no change in November at 132.5 (1982=100). From November 1995 to November 1996, the Finished Goods Price Index rose 3.0 percent. Over the same period, the index for finished energy goods rose 12.9 percent, prices for finished consumer foods increased 3.7 percent, and the index for finished goods other than foods and energy advanced 0.6 percent. Prices received by domestic producers of intermediate goods rose 0.6 percent for the 12 months ended in November, and the index for crude materials moved up 9.4 percent over the same period.

Finished Goods

The Producer Price Index for Finished Energy Goods rose 2.3 percent in November after increasing 1.9 percent a month earlier. Prices for residential gas advanced 3.8 percent, after registering no change in October. The index for finished lubricants turned up in November after falling a month earlier. By contrast, the index for gasoline rose 2.8 percent after increasing 5.5 percent in October. The index for home heating oil declined after advancing in the previous month.

The capital equipment index rose 0.3 percent in November after dropping 0.4 percent in the prior month. Prices for heavy motor trucks advanced 1.9 percent, following a decline of 4.4 percent in October. The index for light motor trucks also rose in November after falling a month ago. Prices for x- ray equipment registered no change after declining in October. The index for civilian aircraft rose more in November than it did in the prior month. Prices for industrial material handling equipment, truck trailers, paper industries machinery, and for pumps and compressors advanced in November after remaining unchanged in the previous month. By contrast, the index for ships fell 3.9 percent following a rise of 4.0 percent in October. Prices also declined for transformers, railroad equipment, textile machinery, and for office and store machines and equipment after increasing a month ago. The index for communications and related equipment dropped after registering no change in October, and prices for commercial furniture rose less than a month ago.

The index for finished consumer goods excluding food and energy remained unchanged in November following a 0.1 percent decline in October. Price increases for passenger cars, cosmetics, light trucks, household furniture, over-the-counter drugs, and prescription drugs offset price declines for women's apparel, sanitary paper products, newspapers, household appliances, floor coverings, and periodicals.

The index for finished consumer foods fell 0.1 percent in November following an increase of 0.8 percent a month earlier. Prices for dairy products declined 4.5 percent after rising 0.2 percent in October. The index for fresh fruits and melons also fell in November following an advance in the previous month. Price increases slowed in November for finfish and shellfish, pork, and bakery products. By contrast, prices for fresh and dry vegetables advanced 16.6 percent in November after rising 7.0 percent a month ago. The index for young chickens also rose more than in October. Prices for eggs for fresh use, turkeys, and confectionery end products turned up after declining in the prior month.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components advanced 0.2 percent in November, seasonally adjusted, after remaining unchanged a month earlier. The indexes for durable manufacturing materials, construction materials, and nondurable manufacturing materials turned up after falling in October. By contrast, prices for energy goods rose less than in the previous month, and the index for foods and feeds fell more than a month earlier. Excluding food and energy prices, the intermediate materials index turned up 0.1 percent after falling the same amount a month ago. (See table B.)

Prices for durable manufacturing materials advanced 0.4 percent after decreasing the same amount in October. The rise in the index for copper accelerated to 7.1 percent from 0.7 percent in the previous month. Prices for copper and brass mill shapes also increased more than a month earlier. The indexes for hot rolled steel sheet and strip, aluminum, and cold rolled steel sheets and strip turned up after falling in October. Prices for plywood and aluminum mill shapes fell less than in the prior month. On the other hand, the index for flat glass turned down 0.1 percent after rising 0.4 percent in the previous month. Prices for hot rolled steel bars, plates, and structural shapes fell more than in October.

The index for construction materials rose 0.4 percent after falling 0.3 percent a month earlier. Prices for softwood lumber turned up 5.4 percent after falling 5.1 percent in the previous month. The indexes for plastic construction products, asphalt felts and coatings, and fabricated ferrous wire products also increased after falling a month earlier. Prices for millwork rose after remaining unchanged in the previous month. By contrast, the index for fabricated structural metal products remained unchanged after increasing 0.4 percent a month ago. Prices for nonferrous wire and cable decreased after rising in the previous month.

Prices for nondurable manufacturing materials turned up 0.1 percent after falling 0.2 percent in October. The index for paperboard rose 1.0 percent after declining the same amount a month earlier. Prices for leather and intermediate basic organic chemicals also turned up after falling in the previous month. The index for primary basic organic chemicals rose more than in the prior month. Conversely, the index for miscellaneous inorganic acids turned down 3.2 percent after increasing 2.4 percent a month ago. Prices for plastic resins and materials, nitrogenates, and for processed yarns and threads also fell after rising in the previous month.

The rise in the index for intermediate energy goods slowed to 1.2 percent from 1.7 percent in October. Prices for jet fuels turned down 7.0 percent following a 1.6-percent rise in the previous month. The indexes for both diesel and residual fuel also dropped after increasing a month earlier. Prices for gasoline, liquefied petroleum gas, and commercial electric power rose less than a month ago. On the other hand, the index for utility natural gas turned up 4.6 percent after falling 0.4 percent in October. Prices for industrial electric power rose more than in the prior month.

The index for intermediate foods and feeds fell 2.2 percent after declining 2.0 percent in the previous month. The index for natural and processed cheese dropped 7.0 percent after decreasing 0.2 percent in October. Prices for flour also fell more than a month earlier. Indexes for confectionery materials and for condensed and evaporated milk turned down after rising in the prior month. Prices for pork rose less than a month ago. The decline in the index for prepared animal feeds, however, slowed to 2.8 percent from 5.2 percent in the previous month. Prices for crude vegetable oils also fell less than in the previous month, and the index for refined sugar turned up after falling in October.

Crude goods

The Producer Price Index for Crude Materials for Further Processing increased 1.8 percent in November, seasonally adjusted, after falling 0.6 percent a month earlier. The index for energy materials rose more than in the prior month, and prices for foodstuffs and feedstuffs fell less than in October. By contrast, the index for basic industrial materials turned down after rising a month ago. (See table B.)

The rise in the index for crude energy materials accelerated to 7.7 percent from 1.5 percent in October. Prices for natural gas turned up 25.1 percent after falling 3.2 percent in the previous month. The index for coal also increased after declining in the prior month. On the other hand, prices for crude petroleum turned down 4.6 percent after rising 8.5 percent in the prior month.

Price declines for intermediate foods and feeds slowed to 1.9 percent from 2.7 percent in the previous month. The index for corn fell 10.2 percent after declining 18.3 percent a month ago. Prices for soybeans also fell less than a month earlier. Indexes for slaughter hogs and for fresh and dry vegetables rose more than in October. By contrast, the index for slaughter cattle turned down 2.2 percent after rising 1.0 percent in the previous month. Prices for fresh fruits and melons and unprocessed shellfish also declined after increasing a month ago. The index for hay remained unchanged after rising a month earlier, and fluid milk prices fell more than in the prior month.

The index for crude nonfood materials less energy turned down 0.3 percent after rising the same amount in the previous month. Prices for iron and steel scrap fell 6.8 percent after decreasing 4.3 percent a month ago. The indexes for wastepaper, cattle hides, and raw cotton turned down after rising a month earlier. Prices for hardwood logs, bolts, and timber remained unchanged after rising in October. Conversely, the index for aluminum base scrap turned up 6.4 percent after falling 1.5 percent in the prior month. Prices for copper ores and for softwood logs, bolts, and timber rose more than in the previous month.

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

Mining. The Producer Price Index for the net output of total domestic mining industries advanced 6.8 percent in November, after increasing 2.7 percent in October. (Net output price indexes are not seasonally adjusted.) In November, prices for the oil and gas extraction industry group index rose 8.9 percent, after increasing 3.9 percent in the previous month. Prices advanced for the metal mining industry group after showing no change in the previous month. Prices for the bituminous coal and lignite mining industry group turned up after falling in October. The index for nonmetallic minerals mining, however, increased 0.2 percent after rising 0.6 percent a month earlier. In November, the Producer Price index for total mining stood at 88.4 (December 1984=100), 25.4 percent higher than a year earlier.

Manufacturing. The Producer Price Index for total domestic manufacturing industries moved down 0.2 percent in November, after rising 0.5 percent in the previous month. The index for the petroleum refining industry group increased 0.4 percent after rising 2.6 percent in the previous month. Price increases also slowed for the apparel industry group. Prices fell more than in October for the food and kindred products, textile mill products, and measuring instruments industry groups. Prices turned down after rising a month earlier for the industry groups for printing and publishing, and miscellaneous manufacturing industries. The index for the transportation equipment industry group was unchanged after rising 2.4 percent in the preceding month. By contrast, prices turned up for the industry groups for lumber and wood products, leather and leather products, and nonmetallic mineral products. Price declines slowed for the industry groups for paper and allied products and for rubber and plastic products. In November the index for total manufacturing was 128.0 (December 1984=100), 2.3 percent above its year earlier level.

Other. Among other industries in November, prices for collection of recovered paper turned down 2.6 percent, after increasing up 8.5 percent in October. Prices also fell after rising in the previous month for general warehousing and storage; water transportation of freight, not elsewhere classified; nonscheduled air transportation; airports and airport services; travel agencies; freight transportation arrangement; telephone communications, except radio telephone; and psychiatric hospitals. Prices fell more than in October for collection of ferrous scrap metal, real estate agents and managers, and passenger car rental. Price increases slowed for deep sea domestic transportation of freight, radio broadcasting, skilled and intermediate care facilities, and for general medical and surgical hospitals.

By contrast, indexes turned up after falling in October for refrigerated warehousing and storage, collection of nonferrous metal scrap, operators of nonresidential buildings, building cleaning and maintenance services, and for truck rental and leasing. Price increases accelerated for air passenger transportation, and employment agencies. Prices declined less than in October for electric power utilities.

The following is the schedule of 1997 release dates for Producer Price Index data:

Reference Month Release Date

January 1997 Friday, February 14 February Friday, March 14 March Friday, April 11 April Wednesday, May 14 May Friday, June 13 June Friday, July 11 July Wednesday, August 13 August Friday, September 12 September Friday, October 10 October Friday, November 14 November Friday, December 12 December Thursday, January 8, 1998

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.

New Seasonal Adjustment Method to be Implemented

Effective with the release of January data on February 14, 1997, the Bureau of Labor Statistics will begin using X-12 ARIMA seasonal adjustment software (developed by the Bureau of the Census) for performing Intervention Analysis Seasonal Adjustment (IASA). The X-12 ARIMA methodology incorporates a number of technical enhancements that improve the estimation of seasonal factors. This change will affect 16 PPI series. In addition, all remaining Producer Price Index series requiring seasonal adjustment will be processed using X-12 ARIMA software beginning in February 1998. Seasonal adjustment methods in the Consumer Price Index will change in similar fashion.

To request a report that describes the new methodology and its effects on the Finished Goods index, please contact Angelo Maggi on (202) 606-7729 or see "Assessing the Impact of February 1997 Improvements to PPI procedures for intervention analysis seasonal adjustment" in the November 1996 issue of PPI Detailed Report.

Seasonal adjustment factors for the PPI are recalculated in January each year to reflect price movements for the prior calendar year. This routine annual recalculation may result in revisions to seasonally adjusted indexes for the previous five years. BLS will make available recalculated seasonally adjusted indexes, as well as recalculated seasonal adjustment factors, for the period January 1992 through December 1996, at 8:30 a.m. on Wednesday, February 12, 1997. This date is two days before the scheduled release of the January 1997 PPI on Friday, February 14, 1997.

The recalculated 1992-1996 seasonally adjusted indexes will be available on the BLS Web site at http://stats.bls.gov. The recalculated 1992-1996 seasonal adjustment factors will be available on the BLS ftp site at ftp://stats.bls.gov. Choose the "pub" directory, the "special.requests" directory, and the "ppi" directory. The revised stage-of-processing index factors will be in the file, "sopsf97.txt." The revised commodity index factors will be in the file, "commsf97.txt."

This information may also be requested from the Division of Industrial Prices and Price Indexes, Section of Index Analysis, at (202) 606-7705.

1/ Comprehensive relative importance figures are initially computed 3/ Includes crude petrolem. after the publication of December indexes and are recalculated 4/ Excludes crude petroleum. after final December indexes are available. The first-published 5/ Percent of total finished goods. and final December relative importances initially appear, 6/ Pecent of total intermediate materials. respectively, in the release tables containing January and May data. 7/ Formerly titled "Crude materials for 2/ The indexes for July 1996 have been recalculated to incorporate further processing, excluding crude late reports and corrections by respondents. All indexes foodstuffs and feedstuffs, plant and are subject to revision four months after original publication. animal fibers, oilseeds, and leaf tobacco." 8/ Percent of total crude materials.

See footnotes at end of table. Table 2. Producer Price Indexes and percent changes for selected commodity groupings by stage of processing - Continued (1982=100 unless otherwise indicated)

1/ The indexes for July 1996 have been recalculated 2/ Not seasonally adjusted. to incorporate late reports and corrections by respondents. 3/ Not available. All indexes are subject to revision four months after original publication.

1Table 3. Producer Price Indexes for selected commodity groupings (1982=100 unless otherwise indicated)

1/ Data for July 1996 have been revised to reflect the availability of late reports and corrections by respondents. All data are subject to revision 4 months after original publication.

2/ Prices of some items in this grouping are lagged 1 month.

1Table #4 Producer price indexes for the net output of major industry groups, not seasonally adjusted