February 2006 Producer Price Index

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The Producer Price Index for Finished Goods declined 1.4 percent in February, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This decrease followed a 0.3-percent gain in January and a 0.6-percent increase in December. At the earlier stages of processing, the intermediate goods index turned down 0.3 percent, after rising 1.2 percent in the previous month, and prices for crude goods dropped 9.2 percent, following a 0.5-percent decrease in January. (See table A.)

2006 Jan. .3 .2 0 .4 5.7 1.2 -.5 Feb. -1.4 -2.7 -4.7 .3 3.7 -.3 -9.2 r=revised. Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for October 2005 have been revised to reflect the availability of late reports and corrections by respondents.

Among finished goods in February, the index for energy goods fell 4.7 percent, following no change a month earlier. Prices for consumer foods turned down 2.7 percent, after a 0.2-percent gain in January. Excluding prices for foods and energy, the finished goods index moved up 0.3 percent in February, compared with a 0.4-percent advance in the previous month.

Before seasonal adjustment, the Producer Price Index for Finished Goods decreased 1.4 percent in February to 157.8 (1982 = 100). From February 2005 to February 2006, prices for finished goods rose 3.7 percent. Over the same period, the index for finished energy goods advanced 17.0 percent, prices for finished goods other than foods and energy increased 1.7 percent, and the finished consumer foods index fell 1.3 percent. For the 12 months ended February 2006, prices for intermediate goods moved up 8.2 percent, and the crude goods index rose 12.9 percent.

Finished goods

The finished energy goods index, which was unchanged in January, decreased 4.7 percent in February. Gasoline prices decreased 11.0 percent, following a 3.5-percent drop in January. The indexes for liquefied petroleum gas and diesel fuel also fell more in February than they had a month earlier. Prices for residential natural gas turned down, after rising in the previous month, and the index for residential electric power was unchanged, after increasing in the prior month. By contrast, the index for lubricating greases advanced 4.1 percent, compared with a 1.3- percent increase in January. (See table 2.)

2006 Jan. .9 1.9 1.0 9.3 -3.0 .6 -.1 23.6 Feb. -1.2 -3.1 .5 8.2 -3.0 -16.2 3.3 12.9 r=revised. Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for October 2005 have been revised to reflect the availability of late reports and corrections by respondents.

Prices for finished consumer foods declined 2.7 percent in February, following a 0.2-percent rise in the previous month. Leading this downturn, the fresh and dry vegetables index dropped 27.1 percent, after moving up 5.9 percent in January. Prices for beef and veal, pork, and eggs for fresh use also turned down in February, following increases a month earlier. The index for dairy products fell more in February than it had in the preceding month, and prices for processed fruits and vegetables rose less than they had in January. By contrast, the index for bakery products advanced 0.8 percent in February, after climbing 0.3 percent in the prior month. Prices for finfish and shellfish posted smaller declines than they had in January.

Price increases for finished consumer goods excluding foods and energy slowed from a 0.4-percent rate in January to a 0.2-percent rate in February. The light motor trucks index moved up 0.5 percent in February, following a 0.7-percent gain in the preceding month. Prices for passenger cars, book publishing, and for sporting and athletic goods turned down, after rising in January. The index for men's and boys' apparel fell more in February than it had a month earlier. Alternatively, cigarette prices advanced 0.5 percent, following a 0.3-percent decline in the prior month. The indexes for household furniture and for women's, girls', and infants' apparel also turned up in February, after decreasing in the previous month. Prices for periodical circulation rose more than they had in January.

Subsequent to a 0.3-percent gain in January, the index for capital equipment increased 0.1 percent in February. Prices for civilian aircraft moved up 0.4 percent, following a 0.7-percent advance in January. The indexes for passenger cars and commercial furniture turned down in February, after rising a month earlier. Prices for light motor trucks and for agricultural machinery and equipment rose less than in January, while the electronic computers index fell more in February than it had a month earlier. By contrast, prices for integrating and measuring instruments turned up 0.4 percent, following a 0.8-percent decline in the preceding month. The indexes for truck trailers and ships also turned up, after declining in January, while prices for metal cutting machine tools increased at faster rates in February than they had a month earlier.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components declined 0.3 percent in February, following a 1.2-percent gain in January. The majority of this downturn is attributable to prices for intermediate energy goods, which fell after advancing in the previous month. The index for intermediate foods and feeds also decreased, after rising in January. Prices for materials and components for construction and the index for materials for nondurable manufacturing increased at slower rates in February than they had in the preceding month. Conversely, prices for materials for durable manufacturing rose more than they had a month earlier. The index for intermediate goods other than foods and energy climbed 0.5 percent in February, following a 1.0-percent jump in January. (See table B.)

The index for intermediate energy goods declined 3.1 percent in February, after advancing 1.9 percent in the prior month. Prices for industrial natural gas fell 7.0 percent, following a 5.7-percent gain in January. The indexes for commercial electric power, commercial natural gas, and industrial electric power also moved down in February, after increasing a month earlier. Prices for gasoline, natural gas to electric utilities, diesel fuel, and liquefied petroleum gas decreased at quicker rates than they had in January. Alternatively, the residual fuels index rose 1.4 percent in February, compared with a 3.6-percent decline in the previous month. (See table 2.)

Prices for materials and components for construction moved up 0.3 percent in February, following a 1.0-percent advance in the preceding month. The concrete products index increased 0.4 percent, after rising 1.9 percent in January. Prices for softwood lumber, plastic construction products, and for cast iron pressure and soil pipe fittings also went up at slower rates in February than they had a month earlier. The indexes for wiring devices, asphalt felts and coatings, and for building paper and board fell, following increases in January. Conversely, prices for nonferrous wire and cable climbed 1.8 percent in February, after decreasing 0.3 percent in the previous month. The index for environmental controls also turned up, while prices for fabricated structural metal products and gypsum products advanced at quicker rates than they had in January.

The index for intermediate foods and feeds declined 1.2 percent in February, following a 0.9-percent gain a month earlier. Prices for prepared animal feeds moved down 0.4 percent, after rising 2.5 percent in January. The indexes for beef and veal, pork, confectionery materials, and for shortening and cooking oils also turned down in February, following increases in the prior month. Dairy product prices decreased at faster rates than they had in January. By contrast, the flour index moved up 3.5 percent, compared with a 1.2-percent decline in the previous month. Prices for dry mix preparations advanced more in February than they had in January, while the index for non-frozen, perishable prepared foods fell less than in the preceding month.

Prices for materials for nondurable manufacturing increased 1.6 percent in February, following a 1.9-percent advance in January. The index for primary basic organic chemicals moved down 1.4 percent in February, compared with a 10.4-percent jump a month earlier. Prices for basic inorganic chemicals, paper, and gray fabrics rose less than they had in January, while the nitrogenates index fell more in February than it had in the prior month. Prices for inedible fats and oils declined, after advancing in the preceding month. By contrast, the paperboard index increased 5.3 percent in February, following a 0.7-percent gain in January. Prices for plastic resins and materials and for ethanol turned up, after decreasing in the previous month. The index for medicinal and botanical chemicals rose, after showing no change in January.

The index for materials for durable manufacturing advanced 1.6 percent in February, following a 1.0-percent advance in January. Prices for cold rolled steel sheet and strip increased 2.0 percent, after decreasing 2.6 percent in the prior month. The indexes for semifinished steel mill products, thermoplastic resins, and unprocessed filament yarns also turned up in February, following declines a month earlier. Prices for nonferrous mill shapes and both primary and secondary aluminum rose more than they had in January. By contrast, the index for hot rolled steel sheet and strip fell 1.4 percent in February, after increasing 0.8 percent in the previous month. Prices for building paper and board and for hot rolled steel bars, plates, and structural shapes also moved down, following increases in the preceding month, while the softwood lumber index advanced less than it had in January.

Crude goods

The Producer Price Index for Crude Materials for Further Processing decreased 9.2 percent in February, following a 0.5-percent decline in January. Prices for crude energy materials turned down in February, after rising in the preceding month. Alternatively, the index for basic industrial materials increased, subsequent to edging down in January. Prices for crude foodstuffs and feedstuffs fell at the same rate as in the prior month. (See table B.)

The crude energy materials index fell 16.2 percent in February, after increasing 0.6 percent in January. Prices for natural gas sank 24.0 percent, following a 1.4-percent decline in the previous month. The crude petroleum index moved down 5.2 percent in February, after advancing 2.6 percent in January. Prices for coal moved up 0.3 percent, following a 10.1- percent jump in the preceding month. (See table 2.)

Prices for basic industrial materials advanced 3.3 percent in February, after inching down 0.1 percent in the preceding month. The majority of this upturn is attributable to the iron and steel scrap index, which gained 7.1 percent following an 8.4-percent decline in January. Prices for logs, bolts, timber, and pulpwood also turned up in February, after falling in the prior month. The indexes for aluminum base scrap, gold ores, and iron ore rose at faster rates than in January. By contrast, prices for wastepaper declined 3.6 percent, following a 1.6-percent increase a month earlier. The indexes for raw cotton and industrial sand also turned down in February, while prices for copper base scrap increased less than in the previous month.

The crude foodstuffs and feedstuffs index fell 3.0 percent in February, matching its January decline. In February, falling prices for slaughter cattle, fluid milk, fresh vegetables (except potatoes), slaughter hogs, and slaughter turkeys outweighed rising prices for wheat, alfalfa hay, corn, Irish potatoes for processing, and raw cane sugar.

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

Mining. The Producer Price Index for the Net Output of Total Mining Industries fell 12.8 percent in February, after edging down 0.2 percent in the preceding month. (Net output price indexes are not seasonally adjusted.) Prices received by the industry for crude petroleum and natural gas extraction dropped 15.8 percent, after rising 3.4 percent in January. The industry index for natural gas liquid extraction decreased more than it had in the preceding month, while prices received by the industries for drilling oil and gas wells, bituminous coal underground mining, and bituminous coal and lignite surface mining advanced at slower rates than they had a month earlier. By contrast, the industry index for oil and gas operations support activities moved down 0.6 percent in February, compared with a 2.9-percent decline in the prior month. Prices received by the industries for gold ore mining, iron ore mining, and for crushed and broken limestone mining and quarrying increased more than they had in January. In February, the Producer Price Index for Total Mining Industries was 207.3 (December 1984 = 100), 24.7 percent above its year-ago level.

Manufacturing. The Producer Price Index for Total Manufacturing Industries declined 0.4 percent in February, following a 0.9-percent rise in the previous month. Leading this downturn, prices received by manufacturers of petroleum and coal products fell 4.3 percent, after increasing 3.2 percent in January. The industry group indexes for transportation equipment, food manufacturing, and medical equipment and supplies manufacturing also turned down in February, after moving up in the preceding month. Prices received by the industry groups for beverage and tobacco manufacturing and nonmetallic mineral product manufacturing rose less than they had in the prior month. Alternatively, the chemical manufacturing industry group index went up 1.1 percent in February, following a 0.8-percent gain a month earlier. Prices received by the industry groups for primary metal manufacturing and paper manufacturing also advanced more than they had in January, and the industry group index for furniture and related product manufacturing turned up, following a decline in the prior month. In February, the Producer Price Index for Total Manufacturing Industries was 153.5 (December 1984 = 100), 4.4 percent above its year-ago level.

Services. Among services industries, prices received by commercial bankers decreased 0.8 percent in February, after advancing 0.9 percent in the previous month. The industry indexes for scheduled passenger air transportation, general medical and surgical hospitals, direct health and medical insurance carriers, and investment banking and securities dealing rose less than they had in January, while prices received by the United States Postal Service were unchanged, following increases in the preceding month. By contrast, the industry index for offices of certified public accountants moved up 3.2 percent in February, compared with a 2.1-percent decline in the prior month. Prices received by the industries for temporary help services; inland water freight transportation; long distance, general freight trucking (truckload); and radio stations also turned up, following decreases in January.