April 2004 Producer Price Index

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The Producer Price Index for Finished Goods advanced 0.7 percent in April, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This increase followed a 0.5-percent rise in March and a 0.1-percent gain in February. April prices for finished goods other than foods and energy went up 0.2 percent, the same rate of increase as in the previous month. At the earlier stages of processing, the intermediate goods index climbed 1.4 percent, compared with a 0.7-percent gain in March. Prices received by manufacturers of crude goods rose 3.0 percent, after advancing 0.7 percent in the preceding month. (See table A.)

The acceleration in finished goods prices can be traced to the index for finished energy goods, which jumped 1.6 percent in April following a 0.6-percent rise in the preceding month. By contrast, capital equipment prices showed no change in April, following a 0.3-percent increase in the prior month. The index for finished consumer foods advanced 1.4 percent, compared with a 1.5-percent gain in March. Prices for finished consumer goods other than foods and energy advanced 0.3 percent for the second consecutive month.

Before seasonal adjustment, the finished goods index moved up 0.8 percent to 147.3 (1982=100). From April 2003 to April 2004, prices for finished goods advanced 3.7 percent. During the same period, the indexes for finished energy goods, finished consumer foods, and finished goods other than foods and energy increased 9.3, 5.9, and 1.5 percent, respectively. At the earlier stages of processing, prices for intermediate goods rose 5.1 percent for the 12 months ended April 2004, while the crude materials index surged 20.4 percent.

Finished goods

Finished energy goods prices advanced 1.6 percent in April, after posting a 0.6-percent gain in the previous month. Residential natural gas prices increased 2.5 percent, following a 0.5-percent decline in the prior month. The index for residential electric power also turned up in April, while gasoline prices rose at a quicker pace than they did in March. On the other hand, the home heating oil index fell 1.3 percent in April, compared with an 11.0-percent jump in the preceding month. The diesel fuel index increased less than it did in March.

Subsequent to a 0.3-percent gain in March, capital equipment prices showed no change in April. The index for light motor trucks fell 1.0 percent in April, compared with a 0.8-percent increase in the previous month. Likewise, prices for commercial furniture, passenger cars, civilian aircraft, and heavy motor trucks turned down, after rising in the prior month. The index for communication and related equipment decreased, following no change a month earlier, while prices for agricultural machinery and equipment rose less than they did in March. By contrast, the index for integrating and measuring instruments edged up 0.1 percent in April, compared with a 1.1-percent decline in the preceding month. Prices for x-ray and electromedical equipment; industrial molds and mold boxes; and plastic working machinery also rebounded, after price decreases in March. The index for ships advanced, after showing no change in March, while construction machinery and equipment prices increased at a faster rate than they did in the prior month.

The index for finished consumer foods rose 1.4 percent in April, following a 1.5-percent gain in the previous month. Over half of the April increase for finished consumer foods prices was due to a 10.4-percent jump in the index for dairy products. Other commodities with notable price increases in April included: beef and veal, soft drinks, pork, processed young chickens, roasted coffee, and shortening and cooking oils. These higher prices were partially offset by declining prices for eggs for fresh use, finfish and shellfish, fresh and dry vegetables, and fresh fruits and melons in April.

The index for finished consumer goods other than foods and energy advanced 0.3 percent in April, the same rate as in the prior month. In April, rising prices for alcoholic beverages, pharmaceutical preparations, cigarettes, soaps and synthetic detergents, pet food, and women's, girls', and infants' apparel outweighed falling prices for light motor trucks, home electronic equipment, book publishing, passenger cars, and sporting and athletic goods.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components advanced 1.4 percent in April, after posting a 0.7-percent gain in March. The indexes for intermediate energy goods, materials for nondurable manufacturing, intermediate foods and feeds, materials and components for construction, and materials for durable manufacturing went up at a quicker rate in April than they did in March. Excluding prices for foods and energy, the intermediate goods index rose 1.1 percent, following a 0.6-percent increase in the prior month. (See table B.)

Prices for intermediate energy goods jumped 1.8 percent in April, following a 0.5-percent advance in March. Commercial natural gas prices climbed 3.9 percent, compared with a 2.1-percent decline in the preceding month. The indexes for industrial natural gas, industrial electric power, and commercial electric power also turned up in April, after falling a month earlier. Prices for gasoline and natural gas to electric utilities moved up at a faster pace than they did in March. By contrast, the index for jet fuels decreased 2.4 percent in April, following a 2.0-percent rise in the previous month. Prices for home heating oil and asphalt also turned down. The index for residual fuel fell more in April than it did in March.

The index for materials for nondurable manufacturing increased 1.1 percent in April, compared with a 0.4-percent gain in March. Prices for industrial chemicals rose 1.9 percent, following a 0.3-percent decrease in the preceding month. Likewise, the indexes for nitrogenates, gray fabrics, and finished fabrics increased, after falling in March. Prices for paperboard and paper rose more in April than they did in the prior month. Conversely, the index for inedible fats and oils rose 2.5 percent in April, following a 12.1-percent jump in March. Price increases also slowed for plastic resins and materials. The indexes for phosphates and for medicinal and botanical chemicals declined, after advancing in the prior month.

Prices for intermediate foods and feeds increased 5.0 percent in April, on the heels of a 2.9-percent advance in March. The index for dairy products surged 10.4 percent, following a 3.7-percent rise a month earlier. Price increases for prepared animal feeds, beef and veal, pork, and shortening and cooking oils also picked up the pace in April. The indexes for confectionery materials and liquid beverage bases used for soft drinks rose in April, after showing no change in March. On the other hand, prices for refined sugar and sugar byproducts edged down 0.1 percent, compared with a 1.2-percent advance in the preceding month. Flour prices declined more in April than they did in the prior month, while the index for processed young chickens went up less than it did in March.

Subsequent to a 1.4-percent increase in March, prices for materials and components for construction climbed 1.7 percent. In April, the index for millwork rose 2.2 percent, following a 0.5-percent gain in the previous month. Price increases for fabricated structural metal products, wiring devices, fabricated ferrous wire products, and steel mill products also gathered speed in April. The index for plastic construction products rose, after showing no change in March. Prices for concrete products turned up in April. By contrast, a 1.8-percent increase in prices for plywood in April followed an 8.6-percent increase a month earlier. The indexes for nonferrous wire and cable, softwood lumber, and gypsum products also advanced less than they did in the preceding month.

The index for materials for durable manufacturing moved up 2.4 percent in April, following a 2.0-percent increase in March. Prices for aluminum mill shapes advanced 1.2 percent, compared with a 0.9-percent decrease in the prior month. Prices for adhesives and sealants also turned up, after falling in March. The indexes for hot rolled steel bars, plates, and structural shapes; cold rolled steel sheet and strip; cold finished steel bars; and primary aluminum (except extrusion billet) rose more in April than they did a month earlier. On the other hand, the index for primary nonferrous metals other than copper, aluminum, and zinc dropped 9.7 percent, following a 0.6-percent decline in the preceding month. Prices for building paper and board and plywood rose less in April than they did in March.

Crude goods

The Producer Price Index for Crude Materials for Further Processing gained 3.0 percent in April, after increasing 0.7 percent in March. Prices for crude energy materials turned up in April, following a decline in the prior month. By contrast, the crude foodstuffs and feedstuffs index rose less than it did in the prior month. The basic industrial materials index turned down in April. (See table B.)

The crude energy goods index increased 6.3 percent in April, following a decrease of 6.1 percent in March. Natural gas prices led this upturn by climbing 7.9 percent, after a 14.1-percent drop in March. The coal index rose 1.4 percent, compared with a 0.2-percent decline in the previous month. On the other hand, crude petroleum prices rose 5.2 percent in April, after a March gain of 8.1 percent.

The index for crude foodstuffs and feedstuffs rose 3.7 percent in April, following an advance of 7.1 percent in the previous month. Slaughter cattle prices led the deceleration by gaining 0.2 percent, after increasing 13.0 percent in March. Prices for soybeans and corn also rose less quickly, while the indexes for fresh and dry vegetables and unprocessed finfish turned down. Alternatively, fluid milk prices soared 23.2 percent in April, after posting an advance of 12.2 percent in the prior month. The indexes for slaughter broilers and fryers and wheat turned up in April, compared with decreases in March. Prices for slaughter hogs fell less in April than in March, while prices for slaughter turkeys and alfalfa hay rose more quickly.

Prices for crude nonfood materials less energy fell 3.9 percent, following a 2.7-percent advance in the previous month. More than half of this downturn was due to the index for iron and steel scrap, which fell 10.1 percent in April after climbing 6.7 percent in March. Leaf tobacco prices and raw cotton prices fell more quickly in April than they did in the preceding month, while the indexes for copper base scrap and wastepaper rose less quickly. On the other hand, the index for nonferrous metal ores gained 8.3 percent in April, following a March increase of 7.1 percent. Prices for aluminum base scrap also rose more quickly in April than in March. The index for pulpwood posted no change, after falling 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 Mining Industries increased 3.4 percent in April, following a 4.0-percent decrease in March. (Net output price indexes are not seasonally adjusted.) The index for the natural gas liquid extraction industry advanced 2.4 percent, after dropping 13.2 percent a month earlier. Prices received by the industries for crude petroleum and natural gas extraction, bituminous coal underground mining, and gold ore mining also turned up in April, following decreases in the prior month. By contrast, the industry index for oil and gas operations support activities fell 2.4 percent, following no change in the previous month. Prices received by the industries for coal mining support activities and for potash, soda, and borate mineral mining turned down, after rising in March. In April, the Producer Price Index for the Net Output of Total Mining Industries was 138.5 (December 1984=100), 11.2 percent above its year-ago level.

Manufacturing. The Producer Price Index for the Net Output of Total Manufacturing Industries advanced 1.1 percent in April, following a 0.6- percent gain in March. Prices received by the food manufacturing industry group jumped 2.6 percent, after rising 1.6 percent in the prior month. The industry group indexes for petroleum and coal products and electric equipment, appliance, and components also rose more in April than they did a month earlier. Prices received by manufacturers of beverage and tobacco products, plastics and rubber products, and computer and electronic products turned up, following declines in March. On the other hand, the index for furniture and related products manufacturing rose 0.4 percent in April, after increasing 0.5 percent a month earlier. Prices received by the industry groups for leather and allied products and for transportation equipment turned down, following March increases. The indexes for manufacturers of chemicals, machinery, and wood products rose at a slower pace in April than they did in the prior month. In April, the Producer Price Index for the Net Output of Total Manufacturing Industries was 141.8 (December 1984=100), 4.0 percent above its year-ago level.

Services. Among service industries in April, prices received by the industries for general medical and surgical hospitals, lessors of nonresidential buildings (except miniwarehouse), portfolio management, employee leasing services, direct life insurance carriers, and offices of physicians (except mental health) increased. Alternatively, the industry indexes for hotels and motels (except casino hotels), securities brokerage, scheduled freight air transportation, couriers, investment banking and securities dealing, and passenger car rental fell in April.