August 2001 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 0.4 percent in August, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This index posted a 0.9-percent decline in July and fell 0.4 percent in June. The index for finished goods other than foods and energy decreased 0.1 percent in August, after rising 0.2 percent a month ago. At the earlier stages of processing, prices received by intermediate goods producers declined 0.4 percent, following a 1.0-percent drop in July. August's crude goods index fell 2.3 percent, compared with a 5.3-percent decrease in July. (See table A.)

In August, a 1.1-percent increase in finished energy goods prices followed a 5.8-percent decline in July and was the principal cause of the upturn in the overall finished goods index. Prices for finished consumer foods also contributed to the acceleration in finished goods by rising 0.9 percent in August, after declining 0.6 percent in the previous month. Partly offsetting price movements in foods and energy, a 0.1-percent August decrease in the index for finished consumer goods other than foods and energy came after a 0.1-percent gain in July. In addition, the capital equipment index decreased 0.1 percent, compared with a 0.2-percent advance in July.

Before seasonal adjustment, the Producer Price Index for Finished Goods increased 0.3 percent in August to stand at 141.1 (1982=100). From August 2000 to August 2001, prices for finished goods advanced 2.1 percent. During the same period, the index for finished goods other than foods and energy rose 1.4 percent, prices for finished consumer foods moved up 3.9 percent, and the finished energy goods index rose 2.0 percent. At the earlier stages of processing, prices received by manufacturers of intermediate goods fell 0.1 percent for the 12 months ended in August, and the index for crude goods declined 4.1 percent.

Finished Goods

The finished energy goods index increased 1.1 percent in August, after posting a 5.8-percent decline in July. Gasoline prices advanced 8.7 percent, following a 17.7-percent drop a month earlier. The indexes for liquefied petroleum gas and home heating oil turned up in August, after showing gains a month ago. Diesel fuel prices fell less in August than they did in July. On the other hand, the residential electric power index decreased 0.3 percent in August, after rising 2.2 percent in the prior month. Prices for residential natural gas and kerosene fell more in August than they did in July.

The index for finished consumer foods posted a 0.9-percent gain in August, after falling 0.6 percent in the previous month. Prices for fresh and dry vegetables increased 15.9 percent, following a 12.5-percent drop in July. The indexes for fresh fruits and melons, processed young chickens, and soft drinks turned up, after falling in the prior month. Beef and veal prices declined at a slower pace in August than in July. By contrast, the pork index decreased 0.1 percent in August, following a 5.4-percent increase in July. Prices for dairy products fell more than they did in the prior month. The indexes for eggs for fresh use and for finfish and shellfish turned down, after rising in July. Prices for bakery products showed no change in August, after moving up in the previous month.

The index for finished consumer goods other than foods and energy edged down 0.1 percent in August, following a 0.1-percent rise a month ago. Prices for light motor trucks declined 0.2 percent, after posting a 2.3- percent gain in July. The indexes for pharmaceutical preparations, floor coverings, and passenger car radial tires also turned down in August, after increasing in July. Prices for sporting and athletic goods fell more than they did a month ago. On the other hand, the passenger cars index rose 0.7 percent in August, following a 0.3-percent decrease in July. Prices for periodical circulation, household appliances, and cosmetics also turned up, after falling in the previous month. The index for women's apparel advanced more than it did in July.

Prices for capital equipment edged down 0.1 percent in August, following a 0.2-percent increase in the previous month. The light motor trucks index declined 0.2 percent, after showing a 2.3-percent gain in July. Prices for electronic computers and for communication and related equipment fell more than they did a month ago. The heavy motor truck index remained unchanged, after increasing in July. Civilian aircraft prices rose less in August than they did in the prior month. The index for commercial furniture turned down, after moving up in July. By contrast, prices for passenger cars advanced 0.7 percent in August, following a 0.3- percent decline in the prior month. The indexes for metal cutting machine tools, X-ray and electromedical equipment, agricultural machinery and equipment, and industrial material handling equipment also turned up, after decreasing a month ago. Prices for pumps and compressors increased more than they did in July.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components fell 0.4 percent in August, after posting a 1.0-percent decrease in July. August prices for intermediate energy goods declined at a slower rate than in July. The index for materials and components for construction showed no change in August, after falling in the previous month. Prices for intermediate foods and feeds rose more than they did in the prior month, while the August index for durable manufacturing materials decreased less than it did in July. On the other hand, prices for nondurable manufacturing materials fell at a slightly faster pace in August than in the previous month. For the second consecutive month, the index for intermediate materials excluding foods and energy fell 0.4 percent. (See table B.)

The intermediate energy goods index decreased 1.0 percent in August, following a 3.8-percent decline in July. Declining August prices for diesel fuel, residual fuel, jet fuels, industrial natural gas, commercial natural gas, natural gas to electric utilities, commercial electric power, and industrial electric power more than offset increasing prices for gasoline and liquefied petroleum gas.

The construction materials index showed no change in August, after posting a 0.5-percent decrease in July. Softwood plywood prices increased 7.3 percent, following a 9.9-percent drop a month earlier. The softwood lumber index fell less than it did in the prior month. The indexes for millwork, gypsum products, nonferrous wire and cable, plumbing fixtures and brass fittings, and fabricated ferrous wire products turned up, after declining in July. Conversely, prices for asphalt felts and coatings decreased 0.3 percent in August, following a 1.0-percent gain in the previous month. The wiring devices index also turned down in August. Prices for fabricated structural metal products showed no change in August, after edging up a month earlier.

The intermediate foods and feeds index advanced 1.8 percent in August, following a 0.6-percent gain in July. Prices for prepared animal feeds rose 2.4 percent, after increasing 0.7 percent in the prior month. The August indexes for crude vegetable oils and for natural, processed, and imitation cheese also advanced at a faster rate than in July. Beef and veal prices fell less than they did in the previous month. The indexes for refined sugar and for confectionery materials turned up, following July declines. By contrast, pork prices edged down 0.1 percent in August, after registering a 5.4-percent gain a month earlier. The indexes for flour and for dry, condensed, and evaporated milk products decreased more in August than they did in July.

The index for durable manufacturing materials fell 0.6 percent in August, following a 0.9-percent decline in July. In August, price decreases for primary aluminum (except extrusion billet); copper and brass mill shapes; aluminum mill shapes; building paper and board; hot rolled steel bars, plates, and structural shapes; and cold rolled steel sheet and strip outweighed price increases for softwood plywood, hot rolled steel sheet and strip, prepared paint, and semi-finished steel mill products.

The index for nondurable manufacturing materials fell 1.3 percent in August, following a 1.1-percent decline in July. Paper prices dropped 1.5 percent in August, after edging down 0.1 percent a month earlier. The indexes for plastic resins and materials, intermediate basic organic chemicals, and finished fabrics also decreased more in August than they did in the prior month. Prices for paperboard, medicinal and botanical chemicals, and synthetic fibers turned down in August. On the other hand, the index for primary basic organic chemicals fell 3.3 percent in August, following an 8.0-percent decline a month earlier. Gray fabric prices turned up, after decreasing in the previous month. The indexes for sulfuric acid and for inedible fats and oils increased more than they did in July.

Crude goods

Subsequent to a 5.3-percent fall in July, the Producer Price Index for Crude Materials for Further Processing declined 2.3 percent in August. Contributing significantly to this slower rate of decline, the index for crude energy materials fell less rapidly in August than in the preceding month. In addition, prices for crude nonfood materials less energy also decreased at a slower pace in August than in July. By contrast, foodstuffs and feedstuffs prices fell this month, after an increase in July. (See table B.)

The crude energy materials index dropped 4.4 percent in August, following an 11.5-percent decline in July. Contributing most appreciably to this slower rate of decline, natural gas prices fell 7.7 percent, after a 19.0-percent drop in the preceding month. The index for crude petroleum also fell at a slower rate than it did in July. On the other hand, the coal index fell 1.9 percent in August, after a 4.7-percent increase in the prior month.

The index for crude nonfood materials less energy fell 0.8 percent in August, following a 0.9-percent decline in the prior month. The 18.9- percent decline in hides and skins prices constituted most of the overall drop in August. The indexes for aluminum base scrap, raw cotton, and copper base scrap also added to the August decline for crude nonfood materials less energy. On the other hand, iron and steel scrap prices increased 1.2 percent in August. The indexes for gold ores; construction sand, gravel and crushed stone; and wastepaper also increased this month.

The index for crude foodstuffs and feedstuffs declined 0.6 percent in August, after increasing by the same rate last month. Leading this deceleration, slaughter hog prices fell 3.9 percent in August, following a 7.5-percent rise in July. The index for unprocessed shellfish declined, after rising in July, while corn and soybean prices increased less rapidly in August than they did in the prior month. Partially counteracting these price movements, indexes for fresh and dry vegetables, and fresh fruits and melons increased, following a decline in July. The slaughter cattle and slaughter broilers and fryers indexes both fell less rapidly in August than they did in the preceding month.

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

Mining. The Producer Price Index for the Net Output of Total Mining Industries fell 2.9 percent in August, following a 10.5-percent drop in July. (Net output price indexes are not seasonally adjusted.) Most of August's slower rate of decline can be traced to a 3.7-percent decrease in prices received by the crude petroleum, natural gas, and natural gas liquids industry, compared with a 14.4-percent drop in the prior month. Prices received by the gold ores; potash, soda, and borate minerals; and coal mining services industries turned up, after falling a month earlier. By contrast, the index for the bituminous coal and lignite industry declined 1.2 percent in August, following a 3.7-percent advance in the previous month. Prices received by the oil and gas well drilling industry also turned down, after rising a month ago. In August, the Producer Price Index for the Net Output of Total Mining Industries stood at 100.4 (December 1984 = 100), 11.8 percent below its year-ago level.

Manufacturing. The Producer Price Index for the Net Output of Total Manufacturing Industries inched up 0.1 percent in August, after declining 1.0 percent in July. Leading the way, prices received by the petroleum refining and related products industry group rose 2.9 percent, following an 11.2-percent drop in the prior month. The industry group indexes for food and kindred products and for printing, publishing, and allied industries rose more than they did in July. Prices received by the lumber and wood products (except furniture) industry group decreased less in August than they did a month ago. The industry group index for measuring and controlling instruments turned up in August. Conversely, prices received by the chemicals and allied products industry group fell 1.6 percent in August, following a 0.8-percent decrease in the previous month. August prices received by the industry groups for transportation equipment and for rubber and miscellaneous plastic products turned down, after rising a month earlier. In August, the Producer Price Index for the Net Output of Total Manufacturing Industries stood at 134.8 (December 1984 = 100), 1.0 percent above its year-ago level.

Services. Among service industries in August, advancing prices were registered by the industries for operators and lessors of nonresidential buildings, skilled and intermediate care facilities, scheduled air transportation, telephone communications (except radiotelephone), property and casualty insurance, local trucking without storage, travel agencies, and for airports, flying fields, and airport services. On the other hand, the industries for offices of physicians, cable and other pay television services, hotels and motels, wireless telecommunications, and specialty hospitals experienced falling prices in August.