November 2012 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 fell 0.8 percent in November, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Prices for finished goods decreased 0.2 percent in October and rose 1.1 percent in September. At the earlier stages of processing, prices received by manufacturers of intermediate goods declined 1.2 percent in November, and the crude goods index edged up 0.1 percent. On an unadjusted basis, the finished goods index advanced 1.5 percent for the 12 months ended November 2012, the smallest increase since a 0.5- percent rise for the 12 months ended July 2012. (See table A.)

Stage-of-Processing Analysis

Finished goods

The November decrease in the finished goods index is attributable to prices for finished energy goods, which fell 4.6 percent. By contrast, the indexes for finished consumer foods and for finished goods less foods and energy advanced 1.3 percent and 0.1 percent, respectively.

Finished energy: The index for finished energy goods fell 4.6 percent in November, the largest decline since a 4.6-percent decrease in March 2009. Accounting for over ninety percent of the November decline, gasoline prices dropped 10.1 percent. Decreases in the indexes for diesel fuel and home heating oil also contributed to lower finished energy goods prices. (See table 2.)

Finished foods: Prices for finished consumer foods rose 1.3 percent in November, the sixth consecutive advance. About forty percent of the November increase can be attributed to the index for beef and veal, which moved up 8.2 percent. Higher prices for fresh and dry vegetables also factored in the advance in the finished consumer foods index.

Finished core: The index for finished goods less foods and energy edged up 0.1 percent in November after declining 0.2 percent a month earlier. Leading this advance, the index for light motor trucks rose 0.2 percent.

Intermediate goods

The Producer Price Index for intermediate materials, supplies, and components dropped 1.2 percent in November, the largest decline since falling 1.5 percent in March 2009. The November decrease was broad based and led by prices for intermediate energy goods, which moved down 4.9 percent. The index for intermediate materials less foods and energy declined 0.1 percent, while prices for intermediate foods and feeds fell 0.3 percent. For the 12 months ended in November, the index for intermediate materials, supplies, and components declined 0.3 percent. (See table B.)

Intermediate energy: Prices for intermediate energy goods fell 4.9 percent in November, the largest decrease since a 5.6-percent decline in March 2009. The index for diesel fuel, which moved down 11.0 percent, was a major factor in the November drop. Falling prices for gasoline and jet fuel also were significant contributors to the decrease in the intermediate energy goods index. (See table 2.)

Intermediate core: The index for intermediate goods less foods and energy edged down 0.1 percent in November after no change a month earlier. Prices for basic inorganic chemicals led the November decrease, moving down 5.8 percent. The index for steel mill products also contributed to the decline in the intermediate core index.

Intermediate foods: Prices for intermediate foods and feeds moved down 0.3 percent in November after eight consecutive increases. This decline can be mostly attributed to a 4.0- percent drop in the index for prepared animal feeds.

Crude goods

The Producer Price Index for crude materials for further processing inched up 0.1 percent in November. For the 3 months ended in November, prices for crude materials advanced 3.7 percent following a 4.3-percent increase from May to August. In November, the monthly rise in the crude goods index was led by prices for crude foodstuffs and feedstuffs, which moved up 0.6 percent. Also contributing to the advance was the index for crude nonfood materials less energy, which rose 0.9 percent. By contrast, prices for crude energy goods fell 0.7 percent. (See table B.)

Crude foods: Prices for crude foodstuffs and feedstuffs climbed 0.6 percent in November. From August to November, prices for crude foods advanced 4.2 percent subsequent to an 8.5- percent increase from May to August. The monthly rise in November was led by a 12.6-percent jump in prices for slaughter chickens. Advances in the indexes for raw milk and slaughter hogs also contributed to the increase in prices for crude foodstuffs and feedstuffs. (See table 2.)

Crude core: The index for crude nonfood materials less energy rose 0.9 percent in November. For the 3 months ended in November, the crude core index advanced 1.1 percent following a 2.2-percent decline from May to August. The monthly increase in November was mostly attributable to a 13.1-percent jump in the index for carbon steel scrap. Higher prices for corrugated wastepaper also were a factor in the rise in the crude core index.

Crude energy: Prices for crude energy materials fell 0.7 percent in November. From August to November, crude energy prices climbed 5.1 percent after rising 5.0 percent in the prior 3-month period. The November monthly decline can be traced to a 7.5-percent decrease in the crude petroleum index.

Services Analysis

Trade industries: The Producer Price Index for the net output of total trade industries rose 0.8 percent in November, the third straight increase. (Trade indexes measure changes in margins received by wholesalers and retailers.) About half of the November advance can be traced to an 11.9-percent jump in prices received by gasoline stations. Higher prices received by merchant wholesalers of both durable and nondurable goods, and by clothing and clothing accessories stores, also were significant factors in the rise in the total trade industries index.

Transportation and warehousing industries: The Producer Price Index for the net output of transportation and warehousing industries declined 0.3 percent in November following a 1.0- percent increase in October. Leading the decrease were prices for scheduled air transportation, which fell 1.6 percent. Lower prices received by the industries for specialized freight trucking and for long-distance general freight trucking by the truckload also contributed to the decline in the transportation and warehousing industries index.

Traditional service industries: The Producer Price Index for the net output of total traditional service industries climbed 0.4 percent in November after inching up 0.1 percent in October. About eighty percent of the November rise can be traced to a 3.4-percent advance in prices received by the depository credit intermediation industry group. Higher prices for investment banking and securities dealing and for automotive equipment rental and leasing also were factors in the increase in the total traditional service industries index.

Recalculated Seasonal Adjustment Factors and Relative Importance Figures to be Available on February 15, 2013

Each year with the release of PPI data for January, seasonal adjustment factors are recalculated to reflect price movements from the just-completed calendar year. Having been in publication for over three years, the wherever-provided services indexes will now be included in this annual process. The following information will be available on February 15, 2013 (2 workdays prior to the release of PPI data for January 2013 on February 20):

* Direct seasonal factors for commodity indexes for the year 2013,

* Recalculated seasonal factors for the last 5 years (2008-2012) for the commodity indexes,

* Recalculated seasonal factors for the last 5 years (2008-2012) for the stage-of-processing indexes,

* Recalculated seasonal data for the last 5 years (2008-2012) for stage-of-processing and commodity indexes.

In addition, December 2012 relative importance figures also will be available on February 15, 2013.

To obtain this information, visit the PPI website at www.bls.gov/ppi or call the Division of Industrial Prices and Price Indexes, Section of Index Analysis and Public Information at (202) 691-7705.