November 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 advanced 0.1 percent in November, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This index rose 0.4 percent in October and 0.9 percent in September. The index for finished goods other than foods and energy showed no change in November, following a 0.1-percent decline in the prior month. Prices received by manufacturers of intermediate goods decreased 0.2 percent, after a 0.2-percent gain a month earlier. The crude goods index fell 2.0 percent, following a 3.4-percent increase in the previous month. (See table A.)

Among finished goods, the finished energy goods index rose 0.4 percent in November, after increasing 1.4 percent a month ago. Prices for finished consumer foods slowed to a 0.2-percent rate of increase, following a 0.8- percent advance a month earlier. The index for finished consumer goods other than foods and energy edged down, after showing no change a month ago. Capital equipment prices were unchanged for the second consecutive month.

For the first 11 months of 2000, the Producer Price Index for Finished Goods increased at a 3.9-percent seasonally adjusted annual rate (SAAR), after rising 2.9 percent in 1999. Prices for finished goods other than foods and energy rose at a 1.0-percent SAAR for the first 11 months of 2000, after posting a 0.9-percent gain for the previous calendar year. The index for intermediate goods advanced at a 4.2-percent SAAR from December 1999 to November 2000, following a 3.7-percent rise during 1999. Prices for crude goods increased at a 23.0-percent SAAR during the first 11 months of 2000, after a 15.3-percent gain for the prior calendar year.

Before seasonal adjustment, the Producer Price Index for Finished Goods declined 0.1 percent to stand at 139.9 (1982 = 100). From November 1999 through November 2000, prices for finished goods advanced 3.7 percent. During the same period, the finished energy goods index jumped 18.8 percent, prices for finished goods other than foods and energy rose 1.0 percent, and the index for finished consumer foods increased 2.0 percent. Prices received by manufacturers of intermediate goods gained 4.2 percent for the 12 months ended in November, and the crude goods index advanced 14.9 percent during the same period.

Finished goods

The finished energy goods index increased 0.4 percent in November, after registering a 1.4-percent gain in October. Residential natural gas prices rose 1.2 percent, following a 5.2-percent advance in the prior month. The index for liquefied petroleum gas also increased less than a month earlier. Prices for residential electric power turned down, after rising in the previous month. By contrast, the gasoline index advanced 1.4 percent in November, following a 1.8-percent decline in October. Prices for diesel fuel and finished lubricants also moved up, after decreasing a month ago. The home heating oil index fell less than in the previous month.

The finished consumer foods index edged up 0.2 percent, following a 0.8-percent gain in October. In November, rising prices were observed for dairy products, fresh and dry vegetables, pork, soft drinks, bakery products, and for beef and veal. On the other hand, the indexes for eggs for fresh use, finfish and shellfish, fresh fruits and melons, roasted coffee, and for processed fruits and vegetables exhibited falling prices in November.

The index for finished consumer goods other than foods and energy edged down 0.1 percent in November, after posting no change in October. In November, declining prices for prescription drugs, sanitary papers and health products, alcoholic beverages, and women's apparel slightly outweighed rising prices for newspaper circulation; cosmetics and other toilet preparations; book publishing; men's and boys' apparel; and girls', children's, and infants' apparel.

The capital equipment index showed no change for the second consecutive month. November price increases for civilian aircraft, passenger cars, commercial furniture, construction machinery and equipment, agricultural machinery and equipment were offset by price declines for x- ray and electromedical equipment, communication and related equipment, transformers and power regulators, light motor trucks, heavy motor trucks, electronic computers, and for office and store machines and equipment.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components declined 0.2 percent in November, after posting a 0.2-percent gain in October. Prices for intermediate energy goods showed no change, after increasing in the previous month. The indexes for durable manufacturing materials fell more than a month ago. Prices for nondurable manufacturing materials turned down, following an increase in October. The intermediate foods and feeds index showed no change, after advancing in the prior month. Construction material prices fell at a slightly faster pace in November than in October. Excluding foods and energy, the intermediate materials index declined, after showing no change in September and October. (See table B.)

Prices for intermediate energy goods showed no change in November, after registering a 1.1-percent increase in October. The index for commercial electric power declined 0.5 percent, following a 1.2-percent advance in the prior month. Prices for residual fuels, commercial natural gas, and industrial natural gas also turned down in November, after rising last month. In November, the indexes for liquefied petroleum gas and industrial electric power rose at a slower pace than in October. By contrast, the gasoline index increased 1.4 percent, following a 1.8-percent drop in October. Diesel fuel prices also turned up, after falling a month ago. The index for jet fuels fell less than in the previous month.

The durable manufacturing materials index dropped 1.1 percent in November, following a 0.2-percent decrease in October. Prices for steel mill products decreased 1.6 percent, after showing no change last month. The index for primary aluminum (except extrusion billet) also fell, following no change in October. Prices for aluminum mill shapes, copper and brass mill shapes, and plywood turned down, after rising a month earlier. By contrast, the index for building paper and board edged down 0.2 percent in November, following a 0.8-percent decline in October. Similarly, prices for flat glass and zinc fell less than in the prior month.

Prices for materials for nondurable manufacturing edged down 0.1 percent in November, following a 0.1-percent increase in October. Prices for primary basic organic chemicals dropped 4.2 percent, after registering a 0.2-percent gain in the previous month. The indexes for fertilizer materials and paper rose less than in the prior month. On the other hand, prices for caustic soda advanced 18.2 percent in November, after rising 1.8 percent in October. The indexes for sulfuric acid, paint materials, and paperboard turned up, following a decline in the prior month. Gray fabric prices increased, after showing no change a month earlier.

The index for intermediate foods and feeds showed no change in November, after posting a 0.6-percent gain in October. Flour prices decreased 1.3 percent, following a 4.8-percent advance in the prior month. The indexes for beef and veal, prepared animal feeds, and pork rose less than in October, while crude vegetable oil prices fell more than a month ago. The index for confectionery materials turned down, after advancing in the previous month. By contrast, prices for fluid milk products declined 1.2 percent in November, following a 2.6-percent rate of decrease in October. The index for butter advanced, after falling last month. Prices for refined sugar moved up at a faster rate in November than in October.

The index for materials and components for construction edged down 0.2 percent in November, following a 0.1-percent decline in October. Falling prices for plywood, softwood lumber, gypsum products, and for asphalt felts and coatings outweighed price increases for wiring devices, nonferrous wire and cable, heating equipment, and steel wire.

Crude goods

The Producer Price Index for Crude Materials for Further Processing turned down 2.0 percent in November, following a 3.4 percent advance in October. Prices for crude energy materials also fell, after rising in the prior month. The crude foodstuffs and feedstuffs index increased at a slower rate than last month. Prices for basic industrial materials fell more than in October. (See table B.)

The index for crude energy materials posted a 4.1-percent decrease in November, following a 4.6-percent advance a month ago. The natural gas index dropped 11.1 percent, after rising 12.3 percent in October. Coal prices fell at a faster pace in November than in the previous month. By contrast, crude petroleum prices turned up 7.1 percent, following a 5.0- percent decrease in the prior month.

The crude foodstuffs and feedstuffs index increased 1.3 percent, after rising 3.5-percent in October. November's deceleration was led by slaughter hog prices, which dropped 9.6 percent after rising 5.4 percent in October. Prices for slaughter broilers and fryers, unprocessed finfish, and for fresh fruits and melons also turned down, after rising in October. The wheat index rose less than in the prior month. On the other hand, slaughter cattle price increases accelerated to 5.6 percent in November from 3.0-percent in the prior month. The indexes for soybeans and fluid milk fell less in November than in October, and prices for slaughter turkeys turned up, after falling last month.

The index for basic industrial materials declined 2.3 percent in November, following a 0.6-percent decrease in the prior month. Prices for nonferrous metal ores decreased 3.9 percent, following a 1.6-percent increase in October. The cattle hides index also fell, after rising a month ago. Prices for aluminum base scrap, iron and steel scrap, wastepaper, and leaf tobacco fell more than in the previous month. By contrast, the pulpwood index turned up 1.3 percent, after edging down 0.1 percent in October. The construction sand and gravel index rose more than in the prior month.

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

Mining. The Producer Price Index for the Net Output of Total Domestic Mining Industries fell 3.2 percent in November, after posting a 5.0-percent gain in October. (Net output price indexes are not seasonally adjusted.) This downturn was led by the index for the crude petroleum, natural gas, and natural gas liquids industry which decreased 3.9 percent, following a 6.2-percent increase last month. Prices received by the copper ores industry also declined, after rising in the prior month. Faster price decreases were reported for the gold ores industry index in November than in October. The iron ores industry index showed no change in November, after rising 2.3 percent in the prior month. By contrast, prices received by the oil and gas well drilling industry turned up 5.7 percent, following a 0.4-percent decline in October. The indexes for coal mining services, the crushed and broken limestone industry, and the kaolin and ball clay industry also advanced, after falling a month ago. In November, the Producer Price Index for the Net Output of Total Domestic Mining Industries stood at 124.6 (December 1984 = 100), 31.0 percent above its year-ago level.

Manufacturing. For the second consecutive month, the Producer Price Index for the Net Output of Total Domestic Manufacturing Industries edged up 0.1 percent. November price increases received by the petroleum refining, food and kindred products, printing and publishing, and rubber and miscellaneous plastic products industries were offset by price decreases for the chemicals and allied products, electrical and electronic machinery, lumber and wood products, and transportation equipment industries. In November, the Producer Price Index for the Net Output of Total Domestic Manufacturing Industries stood at 134.9 (December 1984 = 100), 3.5 percent above its year- ago level.

Services. Among service industries in November, falling prices were observed for real estate agents and managers, telephone communications, life insurance carriers, and for operators and lessors of nonresidential buildings. By contrast, the industries for health services, scheduled air transportation, cable television, and passenger car rental services experienced increasing prices in November.

Improved Quality Adjustment for Microprocessors

Effective with the release of January 2001 data, the Bureau of Labor Statistics will implement a new quality valuation methodology for microprocessors designed and sold for computer applications. This new quality adjustment methodology views changes in the processing power of microprocessors as changes in quality and permits the explicit estimation of their value. The new approach replaces current procedures which have generally been limited to considering price differences between a new microprocessor and its predecessor as a measure of the value of the quality difference between the two.

For additional information, see the October 2000 issue of the Producer Price Index Detailed Report, or contact the Section of Index Analysis and Public Information at (ppi-info@BLS.gov) or (202) 691-7705 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 July 2000 have been recalculated to incorporate further processing, excluding crude late reports and corrections by respondents. All indexes are foodstuffs and feedstuffs, plant and subject to revision 4 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 July 2000 have been recalculated to incorporate 2/ Not seasonally adjusted. late reports and corrections by respondents. All indexes are 3/ Not available. subject to revision 4 months after original publication. Table 3. Producer price indexes for selected commodity groupings (1982=100 unless otherwise indicated)

1/ Data for July 2000 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.

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 July 2000 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 July 2000 have been recalculated to incorporate late reports and corrections by respondents. 2/ Includes crude petroleum. 3/ Excludes crude petroleum.