July 2000 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 showed no change in July, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This index posted a 0.6-percent advance in June and showed no change in May. The index for finished goods other than foods and energy edged up 0.1 percent in July, after falling 0.1 percent a month ago. Prices received by manufacturers of intermediate goods registered a 0.2-percent gain, following a 0.9-percent advance a month earlier. The crude goods index decreased 1.1 percent, after rising 5.8 percent in June. (See table A.)

Finished goods

Change in Except finished Inter- goods foods from 12 mediate Crude and months Month Total Foods Energy energy ago goods goods (unadj.) 1999 July 0.2 -0.4 2.7 -0.1 1.5 0.7 0.2 Aug. .6 .5 3.3 .1 2.3 .5 5.1 Sept. .8 .7 2.1 .6 3.1 .5 4.6 Oct. 0 -.3 -.4 .2 2.8 .2 -2.4 Nov. .1 -.2 1.1 -.1 3.1 .2 5.2 Dec. .1 0 .7 .1 2.9 .3 -4.9

Prices for finished energy goods turned down 0.7 percent, after rising 5.1 percent in the previous month, and caused July's deceleration in the finished goods index. By contrast, the index for consumer goods other than foods and energy edged up, following a small decline in June. Finished consumer food prices showed no changed in July, after falling 0.3 percent in the prior month. The capital equipment index rose, following no change a month ago.

Before seasonal adjustment, the Producer Price Index for Finished Goods fell 0.1 percent in July to stand at 138.3 (1982=100). From July 1999 to July 2000, a 19.2-percent advance in prices for finished energy goods led the 4.1-percent increase for the finished goods index. During the same period, prices for finished goods other than foods and energy rose 1.5 percent, and prices for finished consumer foods increased 2.1 percent. Prices received by manufacturers of intermediate goods rose 5.0 percent for the 12 months ended in July, and the index for crude goods advanced 23.4 percent for the same period.

Finished goods

The finished energy goods index fell 0.7 percent in July, after posting a 5.1-percent gain in June. Most of the deceleration in prices for finished energy goods can be attributed to a downturn in the gasoline index, which decreased 9.1 percent following an 11.8-percent advance last month. Prices for liquefied petroleum gas rose less than in June. The index for home heating oil turned down, after rising in the prior month. By contrast, prices for residential electric power turned up 2.0 percent in July, following a 0.7-percent decline in June. The index for residential natural gas rose at a faster rate than a month ago.

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

The index for finished consumer goods other than foods and energy posted a 0.1-percent gain in July, after declining at the same rate in June. Prices for cigarettes showed no change, following a 1.8-percent decrease in the prior month. The rate of decline in prices for sanitary papers and health products slowed from June to July. The indexes for alcoholic beverages, book publishing, men's and boys' apparel, and household appliances increased, after falling in the previous month. The prescription drugs index rose more than a month earlier. On the other hand, prices for light motor trucks edged down 0.1 percent in July, following a 0.3-percent gain in June. The indexes for home electronic equipment, mobile homes, and cosmetics and other toilet preparations also turned down, after rising a month ago. Prices for girls', children's, and infants' apparel showed no change, following a 1.2-percent advance in June.

The index for finished consumer foods was unchanged in July, after posting a 0.3-percent decrease in June. In July, price increases for dairy products, pork, bakery products, and for finfish and shellfish offset falling prices for eggs for fresh use, beef and veal, processed young chickens, and soft drinks.

The capital equipment index edged up 0.1 percent in July, after showing no change in the prior month. Rising prices for civilian aircraft, office and store machines and equipment, truck trailers, and industrial material handling equipment slightly outweighed falling prices for passenger cars, communication and related equipment, heavy motor trucks, and light motor trucks.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components rose 0.2 percent, after advancing 0.9 percent in June. Most of this deceleration can be attributed to prices for intermediate energy goods, which increased 0.5 percent in July and 4.7 percent in June. Prices for intermediate foods and feeds turned down, after rising in the previous month. The index for materials and components for construction fell more than a month ago. By contrast, prices for nondurable manufacturing materials advanced 0.9 percent, following a 0.6-percent increase a month earlier. The index for durable manufacturing materials rose, after falling in June. Marking the seventeenth consecutive increase, the index for intermediate materials other than foods and energy advanced 0.2 percent in July. (See table B.)

Prices for intermediate energy goods rose 0.5 percent in July, after advancing 4.7-percent in June. Rising prices for industrial electric power, commercial natural gas, jet fuels, industrial natural gas, commercial electric power, diesel fuel, and residual fuel outweighed falling prices for gasoline.

The intermediate foods and feeds index turned down 0.7 percent in July, after registering a 0.4-percent gain in June. The index for prepared animal feeds fell 1.7 percent, following a 0.7-percent increase in the prior month. Prices for flour and for beef and veal also turned down, after rising in the previous month. The crude vegetable oils index fell more than a month earlier. Conversely, prices for fluid milk products advanced 1.6 percent, after edging up 0.1 percent a month ago. The indexes for pork and for natural, processed, and imitation cheese also rose more than in the prior month.

The index for materials and components for construction decreased 0.3 percent in July, after a 0.1-percent decline in June. Softwood lumber prices fell 3.3 percent, following a 0.8-percent drop in the prior month. The indexes for plastic construction products, heating equipment, and for air conditioning and refrigeration equipment turned down, after rising in the previous month. Prices for asphalt felts and coatings rose less than a month ago. By contrast, the index for wiring devices rose 0.2 percent, after falling 0.3 percent a month earlier. Prices for fabricated structural metal products, nonferrous wire and cable, and plywood fell less than in the prior month.

Prices for nondurable manufacturing materials increased 0.9 percent in July, after posting a 0.6-percent rise in June. The industrial chemicals index advanced 2.5 percent, following a 0.9-percent gain in the prior month. Prices for gray fabrics, phosphates, and for processed yarns and threads turned up, after falling in the previous month. On the other hand, the plastic resins and materials index turned down 0.3 percent, following a 0.8-percent gain a month ago. Prices for medicinal and botanical chemicals and inedible fats and oils also fell, after rising a month earlier. Paperboard prices rose less than in the prior month.

The durable manufacturing materials index increased 0.1 percent in July, after falling 0.2 percent in June. Prices for aluminum, except extrusion billet, gained 2.9 percent, following a 1.1-percent rise in the previous month. The indexes for aluminum mill shapes, copper and brass mill shapes, and for cold rolled sheet and strip rose, after falling a month ago. Flat glass prices rose more than in the prior month. By contrast, the hot rolled sheet and strip index dropped 0.8 percent, following a 0.3-percent decline a month earlier. Prices for gold and platinum turned down, after rising in June. The silver index fell, after showing no change in the previous month.

Crude goods

The Producer Price Index for Crude Materials for Further Processing declined 1.1 percent in July, after posting a 5.8-percent advance in June. A slower rate of increase for crude energy materials accounted for nearly all of the downturn in the crude goods index. Prices for basic industrial materials and for crude foodstuffs and feedstuffs fell slightly more than in the prior month. (See table B.)

The index for crude energy materials edged up 0.4 percent in July, after registering a 16.2-percent increase in June. Crude petroleum prices fell 7.2 percent, following a 13.8-percent jump in the previous month. The natural gas index rose 6.4 percent, after gaining 23.9 percent a month ago. By contrast, coal prices advanced 0.6 percent, following a 1.6-percent decline a month earlier.

The index for basic industrial materials decreased 1.8 percent in July, after posting a 1.3-percent drop in the prior month. Following a June decline of 1.4 percent, wastepaper prices fell 12.3 percent in July, the largest decline since a 13.3-percent drop in April 1996. The index for softwood logs, bolts, and timber also decreased more than in the previous month. Prices for gold and copper ores turned down, after rising in the previous month. On the other hand, prices for aluminum base scrap advanced 4.1 percent in July, after showing no change in June. The indexes for raw cotton and for iron and steel scrap fell less than a month earlier. Prices for cattle hides, hardwood logs, pulpwood logs, and phosphates turned up, after decreasing a month ago.

The index for crude foodstuffs and feedstuffs declined 2.7 percent in July, following a 2.6-percent decrease a month earlier. Falling July prices for corn, soybeans, slaughter cattle, slaughter broilers and fryers, and Irish potatoes for processing outweighed rising prices for fluid milk, slaughter hogs, and unprocessed finfish.

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

Mining. The Producer Price Index for the Net Output of Total Domestic Mining Industries advanced 0.9 percent in July, after registering a 13.8- percent gain in June. (Net output price indexes are not seasonally adjusted.) Leading the deceleration among mining industries, the index for the crude petroleum, natural gas, and natural gas liquids industry increased 1.0 percent, following a 19.0-percent rise a month earlier. Prices received by the gold ores and copper ores industries declined, after advancing in the prior month. The index for the crushed and broken limestone industry increased less than a month ago. By contrast, prices received by the bituminous coal and lignite industry rose 0.5 percent, following a 1.2-percent drop in June. The indexes for the potash, soda, and borate minerals industry and for the oil and gas field exploration services industry also turned up, after falling in the previous month. Prices received by the oil and gas well drilling industry gained more than a month earlier. In July, the Producer Price Index for the Net Output of Total Domestic Mining Industries stood at 114.8 (December 1984=100), 45.9 percent above its year-ago level.

Manufacturing. The Producer Price Index for the Net Output of Total Domestic Manufacturing Industries decreased 0.3 percent in July, after posting a 0.4-percent advance in the prior month. Prices received by the petroleum refining industry declined 5.0 percent, following a 6.4-percent increase a month ago. The index for the printing, publishing, and allied industries group rose less than in the previous month. Prices received by the measuring and controlling instrument industry group showed no change, after gaining in June. The index for the lumber and wood products (except furniture) industry group fell more than a month earlier. Conversely, prices received by the chemicals and allied products industry group advanced 0.6 percent in July, following a 0.1-percent increase in June. The index for the food and kindred products industry group rose 0.2 percent, after showing no change in the prior month. Prices received by the tobacco manufactures industry group and the transportation equipment industry group were unchanged for July, following decreases a month earlier. In July, the Producer Price Index for the Net Output of Total Domestic Manufacturing Industries stood at 133.6 (December 1984=100), 4.1 percent above its year-ago level.

Services. Prices received by general medical and surgical hospitals, offices of physicians, skilled and intermediate care facilities, hotels and motels, and operators and lessors of nonresidential buildings increased in July. By contrast, the indexes for the trucking (except local) industry, life insurance carriers, travel agencies, and the non-scheduled air transportation industry decreased this month.

Resampling of Industries Effective with this release, the Producer Price Index (PPI) includes data for 13 resampled industries. The Bureau of Labor Statistics periodically updates the sample of producers providing data for the PPI to reflect current conditions more accurately when the structure, membership, technology, or product mix of an industry shifts significantly. The first results of this systematic process were published in July 1986. Subsequent efforts have been completed at 6-month intervals. For information on specific additions, deletions, and recodes of indexes that are effective this month, see the July 2000 issue of the PPI Detailed Report or contact the Section of Index Analysis and Public Information at (202) 691-7705.

As part of an ongoing effort to expand coverage to sectors of the economy other than mining and manufacturing, 7 industries are being introduced into the PPI for the first time. These new indexes comprise the food stores and new car dealers portions of retail trade. Indexes for these industries appear in table 5 of the PPI Detailed Report. (Table 5 also includes data for SIC 5451 Dairy Products Stores in an aggregate index for SIC 54 Food Stores.) For further discussion of these new indexes, see "Retail trade industries in the PPI" in the July 2000 issue of the PPI Detailed Report or call the Section of Index Analysis and Public Information at (202) 691-7705.

Standard Industrial Classification (SIC) Code Industry

1081 Metal mining services 1241 Coal mining services 1481 Non-metallic minerals (except fuels) services 2295 Coated fabrics, not rubberized 2673 Plastics, foil and coated paper bags 2835 In vivo and In vitro diagnostics 2841 Soap and other detergents 2843 Surface-active agents 3677 Electronic coils, transformers, and other inductors 3679 Electronic components, n.e.c. 3694 Electrical equipment for internal combustion engines 4221 Farm product warehousing and storage 4841 Cable and other pay television services 5411 Grocery stores 5421 Meat and fish (seafood) markets 5431 Fruit and vegetable markets 5441 Candy, nut, and confectionery stores 5461 Retail bakeries 5499 Miscellaneous food stores 5511 New car dealers