September 1999 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 increased 1.1 percent in September, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This increase followed a 0.5-percent advance in August and a 0.2-percent gain in July and represents the largest one-month increase since September 1990, when prices for finished goods rose 1.3 percent. Prices received by producers of intermediate goods gained 0.3 percent, following a 0.8-percent increase in the prior month. The crude goods index moved up 5.1 percent, after rising 4.6 percent in August. (See table A.)

Finish ed goods

Change in Except finished Inter- goods foods from 12 mediate Crude and months Month Total Foods Energy energy ago goods goods (unadj.) 1998 Sept. 0.2 0.2 -0.4 0.3 -0.9 -0.3 -1.8 Oct. .3 .4 .8 .1 -.7 -.2 2.5 Nov. -.2 -.4 -1.3 .1 -.6 -.2 -.1 Dec. .5 0 -1.8 1.0 0 -.7 -3.6

Among finished goods, the index for finished goods other than foods and energy advanced 0.8 percent, after posting a 0.1-percent decline a month earlier. This acceleration was primarily due to price increases for cigarettes and passenger cars. (Excluding these two commodities, the index for finished goods less foods and energy would have increased 0.1 percent in September.) Prices for finished consumer foods rose 1.0 percent, following a 0.4-percent gain in August. By contrast, the index for finished energy goods advanced 2.2 percent, after rising 3.7 percent last month.

During the third quarter of 1999, the PPI for finished goods moved up at a 7.5-percent seasonally adjusted annual rate (SAAR), after increasing at a 2.5-percent rate in the second quarter. Prices for finished energy goods rose at a 43.9-percent SAAR from June to September, following a 21.9- percent rate of advance from March to June. The index for finished goods other than foods and energy moved up at a 2.8-percent SAAR during the third quarter, after showing no change in the second quarter. Finished consumer foods prices advanced at a 2.1-percent SAAR from June to September, following a 0.3-percent rate of increase from March to June. During the third quarter of 1999, the PPI for intermediate goods rose at a 7.0-percent SAAR, after increasing at a 5.0-percent rate during the second quarter of this year. Prices for crude goods advanced at a 45.3-percent SAAR from June to September, following a 40.5-percent rate of increase from March to June.

Interm Crude ediate goods goods Change in intermedi ate Change in Exclud goods crude goods ing from Excluding from foods 12 months foods 12 months and ago Energy and ago Month Foods Energy energy (unadj.) Foods (unadj.) energy (unadj.)

Before seasonal adjustment, the Producer Price Index for Finished Goods gained 0.8 percent in September to stand at 134.8 (1982=100). From September 1998 to September 1999, the finished goods index advanced 3.2 percent. Over the past 12 months, prices for finished energy goods increased 13.9 percent, the index for finished goods other than foods and energy moved up 1.7 percent, and prices for finished consumer foods rose 1.2 percent. Prices received by producers of intermediate goods increased 1.9 percent for the 12 months ended in September, and the index for crude materials advanced 16.1 percent during the same period.

Finished goods

The index for finished consumer goods other than foods and energy advanced 1.1 percent in September, after posting a 0.1-percent decline in August. Cigarette prices moved up 9.5 percent, following a 0.1-percent advance a month ago. The passenger car index increased 2.0 percent in September, after edging down 0.1-percent in the previous month. Light motor truck prices rose 0.8 percent, following a 0.4-percent decline in the prior month. Prices for sanitary papers and health products; wines, brandy, and brandy spirits; and women's apparel also turned up, after falling a month earlier. On the other hand, the index for cosmetics and other toilet preparations declined 0.4 percent in September, following a 0.1-percent gain in August. Prices for passenger car radial tires showed no change, after advancing last month. The index for toys, games, and childen's vehicles fell, after showing no change in the prior month. Prices for finished consumer goods other than foods and energy rose at a 4.3-percent SAAR for the three months ended in September, following a 0.3- percent rate of increase in the previous quarter.

The finished consumer foods index increased 1.0 percent in September, after registering a 0.4-percent gain in August. Prices for fresh and dry vegetables advanced 8.4 percent, following a 5.3-percent drop a month earlier. The indexes for fresh fruits and melons, processed young chickens, beef and veal, and for finfish and shellfish also turned up, after falling in the previous month. Prices for dairy products and pork rose more than a month ago. By contrast, the index for eggs for fresh use declined 12.8 percent in September, following a 2.8-percent gain in August. Prices for soft drinks showed no change, after posting an increase the last month. The roasted coffee index fell more than in the prior month.

The index for capital equipment advanced 0.2 percent in September, after showing no change in August. Prices for light motor trucks increased 0.8 percent, following a 0.4-percent decrease a month earlier. Heavy motor truck prices also turned up, after falling last month. The index for electronic computers fell less than a month ago, while prices for civilian aircraft and for construction machinery and equipment rose more than in the previous month. The truck trailers index rose, after showing no change in August. Conversely, prices for communication and related equipment declined 0.3 percent, after showing no change in the prior month. The index for x-ray and electromedical equipment fell more than in August. Capital equipment prices rose at a 0.3-percent SAAR from June to September, after showing no change from March to June.

Prices for finished energy goods increased 2.2 percent in September, following a 3.7-percent rise in August. The gasoline index advanced 2.2 percent, after registering a 9.1-percent gain a month earlier. Residential electric power prices also rose less than a month ago. By contrast, the residential natural gas index moved up 2.5 percent, following 1.1-percent increase in the previous month. Prices for liquefied petroleum gas and home heating oil rose more than last month. The finished lubricants index fell less than in August.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components increased 0.3 percent in September, seasonally adjusted, following a 0.8-percent advance in August. Prices for intermediate energy goods rose less than in August. The index for durable manufacturing materials turned down, following an increase a month ago. Prices for materials and components for construction fell more than in the previous month. The index for materials for nondurable manufacturing rose less than last month. Conversely, prices for intermediate foods and feeds increased more than in August. Prices for intermediate materials other than foods and energy posted a 0.1-percent increase, following a 0.2-percent rise in the prior month. (See table B.)

The index for intermediate energy materials increased 1.8 percent in September, following a 3.8-percent rise in August. Prices for commercial electric power increased 0.1 percent, following a 2.2-percent gain in the previous month. The indexes for gasoline and jet fuels rose less than last month. Industrial electric power prices showed no change, after advancing in August. The diesel fuel index turned down, following an increase last month. By contrast, prices for residual fuels jumped 20.5 percent, after a 7.5-percent advance in the prior month. The indexes for commercial natural gas and industrial natural gas rose more than in the previous month. Prices for intermediate energy materials advanced at a 40.0-percent SAAR from June 1999 to September 1999, after rising at a 22.1-percent rate in the previous quarter.

The index for durable manufacturing materials declined 0.4 percent in September, following a 0.2-percent rise in August. Prices for steel mill products turned down 0.4 percent, following a 0.2-percent rise in the prior month. The index for plywood fell more than a month ago. Prices for aluminum mill shapes and for building paper and board turned down, after rising in the previous month. The index for flat glass showed no change, following a 0.2-percent increase last month. On the other hand, prices for copper and brass mill shapes moved up 1.9 percent in September, after rising 0.4 percent in August. The indexes for hardwood lumber, zinc, and platinum rose more than in the previous month. Durable manufacturing material prices rose at a 2.6-percent SAAR from June 1999 to September 1999, after advancing at a 6.3-percent rate during the second quarter.

Prices for materials and components for construction fell 0.5 percent in September, after declining 0.1 percent in August. The index for plywood fell 11.4 percent, after registering a 2.7-percent decrease a month ago. Prices for gypsum products and non-fluid power metal valves turned down, following last month's increases. The indexes for cement and heating equipment rose less than in the previous month. By contrast, prices for softwood lumber fell 4.2 percent in September, after dropping 6.0 percent in August. The plastic construction products index rose more than in the previous month. Prices for fabricated ferrous wire products and for plumbing fixtures and brass fittings turned up, after falling in the prior month. This index for materials and components for construction increased at a 0.8-percent SAAR for the third quarter of 1999, following a 4.1- percent rate of increase during the second quarter.

The index for nondurable manufacturing materials increased 0.4 percent in September, following a 0.6-percent gain in August. Prices for paperboard fell 2.2 percent, following a 3.6-percent advance in the prior month. The indexes for paint materials and phosphates also turned down, after rising in the previous month. Prices for plastic resins and materials rose less than the month before. By contrast, the paper index rose 0.4 percent in September, following a 0.4-percent decline in August. Prices for gray fabrics, inedible fats and oils, and nitrogenates also turned up, after falling a month ago. The index for industrial chemicals increased faster than in the previous month. Nondurable manufacturing material prices rose at a 5.6-percent SAAR during the third quarter of 1999, after increasing at a 5.7-percent rate during the second quarter.

Prices for intermediate foods and feeds moved up 1.3 percent in September, after rising 1.1 percent in August. The index for fluid milk products rose 3.6 percent, after falling 0.2 percent last month. Prices for confectionery materials and for beef and veal also turned up, following a decline a month ago. The indexes for pork and for dry, condensed, and evaporated milk products rose more than in the prior month. On the other hand, prices for crude vegetable oils increased 0.4 percent in September, following a 9.5-percent advance in August. The index for flour turned down, after rising a month ago. Prices for natural, processed, and imitation cheese and for prepared animal feeds rose less than in the previous month. The intermediate foods and feeds index advanced at a 4.0- percent SAAR during the third quarter of 1999, following a 2.8-percent rate of decline in the previous quarter.

Crude Goods

The Producer Price Index for Crude Materials for Further Processing rose 5.1 percent in September, seasonally adjusted, following a 4.6-percent rise in August. Prices for crude energy materials and basic industrial materials increased more than in the previous month. By contrast, price increases slowed for crude foodstuffs and feedstuffs. (See table B.)

The index for crude energy materials rose 10.4 percent in September, following a 7.2-percent increase in August. September's acceleration was led by the crude petroleum index, which advanced 14.3 percent, after rising 6.5 percent in the prior month. In addition, prices for natural gas rose 13.3 percent, after advancing 10.6 percent in August. By contrast, the index for coal fell 3.8 percent, following a 0.2-percent decline a month earlier. Prices for crude energy materials increased at a 126.6-percent seasonally adjusted annual rate from June 1999 to September 1999, following 158.3-percent rate of advance in the second quarter.

The basic industrial materials index rose 2.2 percent, following a 1.8- percent rise in August. Prices for leaf tobacco rose 9.1 percent, after increasing 0.9 percent in August. The aluminum base scrap index also rose more than last month. Indexes for wastepaper and copper base scrap moved up, following declines in the prior month. By contrast, price increases slowed from August to September for iron and steel scrap and cattle hides. The indexes for raw cotton and softwood logs turned down, after rising a month earlier. Basic industrial material prices increased at a 28.1- percent seasonally adjusted annual rate in the third quarter of 1999, following a 7.3-percent annual rate of advance in the second quarter of 1999.

The index for crude foodstuffs and feedstuffs advanced 1.3 percent, following a 3.8-percent increase in August. Corn prices turned down 5.0 percent, after advancing 25.7 percent a month ago. Slaughter hog prices also fell, following an increase in August. The indexes for soybeans, fluid milk, wheat, and fresh vegetables (except potatoes) rose less than a month ago. Prices for alfalfa hay and Louisiana rough rice fell more than in the prior month. On the other hand, prices for slaughter broilers and fryers turned up 8.2 percent, after falling 12.6 percent in August. The index for Irish potatoes for processing more than doubled in September from a sharp decline in the prior month. Prices for fresh fruits and melons, slaughter turkeys, and unprocessed shellfish also increased, after declining last month. Prices for raw cane sugar fell less than in previous month. The crude foodstuffs and feedstuffs index moved up at a 0.4-percent SAAR from June 1999 to September 1999, after showing no change in the second quarter of 1999.

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

Mining. The Producer Price Index for the net output of total domestic mining industries rose 9.1 percent in September, after registering a 6.3- percent advance in August. (Net output price indexes are not seasonally adjusted.) Prices received by the crude petroleum, natural gas, and natural gas liquids industry rose 14.0 percent, following a 9.6-percent increase a month ago. The industry indexes for oil and gas well drilling, crushed and broken limestone, and for dimension stone rose, after falling in the prior month. By contrast, the industry index for bituminous coal and lignite mining fell 2.5 percent, following a 0.2-percent decline in the previous month. Price increases in the copper ores and gold ores mining industries rose less than a month ago. The index for the potash, soda, and borate minerals industry fell more than in the prior month. In September, the Producer Price Index for the net output of total domestic mining industries stood at 90.9 (December 1984=100), 38.4 percent above its year- ago level. During the third quarter of 1999, this index increased at a 102.5-percent annual rate, following a 108.7-percent rate of increase in the second quarter.

Manufacturing. The Producer Price Index for the net output of total domestic manufacturing industries increased 0.5 percent in September, after posting a 0.6-percent rise in August. Increases in the industry indexes for petroleum refining and related products, tobacco manufactures, food and kindred products, chemicals and allied products, and paper and allied products outweighed declining industry indexes for lumber and wood products (except furniture), transportation equipment, machinery (except electrical), measuring and controlling instruments, electromedical equipment, and primary metals. In September, the Producer Price Index for the net output of total domestic manufacturing industries stood at 129.7 (December 1984=100), 3.0 percent above its year-ago level. From June 1999 to September 1999, this index rose at a 6.1-percent annual rate, after increasing at a 4.8-percent rate in the previous quarter.

Other. Among other industries in September, the industry indexes for operators and lessors of nonresidential buildings, deep sea foreign transportation of freight, telephone communications (except radiotelephone), life insurance carriers, radio broadcasting, and scheduled air transportation registered increases. By contrast, the industry indexes for real estate agents and managers, hotels and motels, wireless communications, marine cargo handling, travel agencies, passenger car rental, cable and other pay televisions services, and home health care services declined in September.

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. Table 1. Producer price indexes and percent changes by stage of processing (1982=100)

1/ Comprehensive relative importance figures are initially computed 3/ Includes crude petroleum. 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/ Percent of total intermediate materials. respectively, in the release tables containing January and May data. 7/ Formerly titled "Crude materials for 2/ The indexes for May 1999 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. Table 2. Producer price indexes and percent changes for selected commodity groupings by stage of processing (1982=100 unless otherwise indicated)

See footnotes at end of table.

1/ The indexes for May 1999 have been recalculated to incorporate 2/ Not seasonally adjusted. late reports and corrections by respondents. All indexes 3/ Not available. are subject to revision four months after original publication. Table 3. Producer price indexes for selected commodity groupings (1982=100 unless otherwise indicated)

1/ Data for May 1999 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. Table 4. Producer price indexes for the net output of major industry groups, not seasonally adjusted

1/ Indexes in this table are derived from the net-output-weighted industry price indexes. Because of differences in coverage and aggregation methodology, they will generally not match the movements of similarly-titled indexes which are derived from traditional commodity groupings. 2/ The indexes for May 1999 have been recalculated to incorporate late reports and corrections by respondents. All indexes are subject to revision 4 months after original publication. 3/ Not available. Table 5. Producer price indexes by stage of processing, seasonally adjusted (1982=100)

1/ All seasonally adjusted indexes are subject to change up to 5 years after original publication due to the recalculation of seasonal factors each January. The indexes for May 1999 have been recalculated to incorporate late reports and corrections by respondents. 2/ Includes crude petroleum. 3/ Excludes crude petroleum.