November 2021 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 final demand increased 0.8 percent in November, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices moved up 0.6 percent in each of the 3 prior months. (See table A.) On an unadjusted basis, the final demand index rose 9.6 percent for the 12 months ended in November, the largest advance since 12-month data were first calculated in November 2010.

In November, the index for final demand services rose 0.7 percent and prices for final demand goods increased 1.2 percent.

The index for final demand less foods, energy, and trade services moved up 0.7 percent in November, the largest rise since climbing 0.8 percent in July. For the 12 months ended in November, prices for final demand less foods, energy, and trade services increased 6.9 percent, the largest advance since 12-month data were first calculated in August 2014.

Final Demand

Final demand services: The index for final demand services rose 0.7 percent in November, the eleventh consecutive advance. Over half of the broad-based increase in November can be traced to prices for final demand services less trade, transportation, and warehousing, which climbed 0.6 percent. The indexes for final demand trade services and for final demand transportation and warehousing services also moved higher, rising 0.6 percent and 1.9 percent, respectively. (Trade indexes measure changes in margins received by wholesalers and retailers.)

Product detail: Leading the November increase in the index for final demand services, prices for portfolio management advanced 2.9 percent. The indexes for guestroom rental; securities brokerage, dealing, investment advice, and related services; fuels and lubricants retailing; airline passenger services; and transportation of freight and mail also moved higher. In contrast, margins for chemicals and allied products wholesaling fell 1.3 percent. The indexes for furnishings wholesaling and for bundled wired telecommunications access services also declined. (See table 2.)

Final demand goods: The index for final demand goods rose 1.2 percent in November following a 1.3-percent increase in October. In November, advances were broad based. Prices for final demand goods less foods and energy climbed 0.8 percent, the index for final demand energy jumped 2.6 percent, and prices for final demand foods moved up 1.2 percent.

Product detail: Within final demand goods in November, prices for iron and steel scrap rose 10.7 percent. The indexes for gasoline, fresh fruits and melons, fresh and dry vegetables, industrial chemicals, and jet fuel also moved higher. Conversely, prices for diesel fuel decreased 2.6 percent. The indexes for processed young chickens and for light motor trucks also fell.

Intermediate Demand by Commodity Type

Within intermediate demand in November, prices for processed goods moved up 1.5 percent, the index for unprocessed goods increased 4.8 percent, and prices for services advanced 0.6 percent. (See tables B and C.)

Processed goods for intermediate demand: The index for processed goods for intermediate demand advanced 1.5 percent in November after rising 2.4 percent in October. Over half of the November increase can be attributed to prices for processed materials less foods and energy, which moved up 1.2 percent. The index for processed energy goods rose 3.6 percent. In contrast, prices for processed foods and feeds fell 0.2 percent. For the 12 months ended in November, the index for processed goods for intermediate demand advanced 26.5 percent, the largest 12-month increase since jumping 28.9 percent in December 1974.

Product detail: A major factor in the increase in prices for processed goods for intermediate demand was the index for industrial chemicals, which rose 2.5 percent in November. Prices for utility natural gas, gasoline, electric power, fabricated structural metal products, and hot rolled steel sheet and strip also moved higher. Conversely, the index for confectionery materials fell 6.2 percent. Prices for diesel fuel and for primary nonferrous metals also decreased.

Unprocessed goods for intermediate demand: The index for unprocessed goods for intermediate demand rose 4.8 percent in November, the eighth consecutive increase. Over 80 percent of the November advance can be traced to prices for unprocessed energy materials, which moved up 8.7 percent. The index for unprocessed nonfood materials less energy increased 4.5 percent. In contrast, prices for unprocessed foodstuffs and feedstuffs fell 0.7 percent. For the 12 months ended in November, the index for unprocessed goods for intermediate demand jumped 52.5 percent.

Product detail: In November, nearly two-thirds of the rise in prices for unprocessed goods for intermediate demand can be attributed to a 14.3-percent increase in the index for natural gas. Prices for crude petroleum, grains, iron and steel, nonferrous metal ores, and fresh fruits and melons also moved higher. Conversely, the index for raw milk decreased 10.3 percent. Prices for slaughter poultry and for hides and skins also declined.

Services for intermediate demand: The index for services for intermediate demand advanced 0.6 percent in November after inching up 0.1 percent in October. Most of the increase in November can be attributed to a 0.8-percent rise in prices for services less trade, transportation, and warehousing for intermediate demand. The index for transportation and warehousing services for intermediate demand climbed 0.7 percent, while margins for trade services for intermediate demand were unchanged. For the 12 months ended in November, the index for services for intermediate demand advanced 8.1 percent.

Product detail: Over a quarter of the November rise in the index for services for intermediate demand can be traced to a 6.1-percent advance in prices for securities brokerage, dealing, investment advice, and related services. The indexes for portfolio management, television advertising time sales, transportation of freight and mail, temporary help services, and fuels and lubricants retailing also increased. In contrast, margins for chemicals and allied products wholesaling fell 1.3 percent. The indexes for arrangement of freight and cargo transportation and for business loans (partial) also declined.

Intermediate Demand by Production Flow

Stage 4 intermediate demand: The index for stage 4 intermediate demand increased 1.0 percent in November, the largest rise since moving up 1.3 percent in June. In November, prices for total goods inputs to stage 4 intermediate demand advanced 1.4 percent, and the index for total services inputs climbed 0.7 percent. (See table D.) Increases in prices for fabricated structural metal products; securities brokerage, dealing, investment advice, and related services; portfolio management; utility natural gas; gasoline; and electric power outweighed decreases in the indexes for furnishings wholesaling, chemicals and allied products wholesaling, and diesel fuel. For the 12 months ended in November, prices for stage 4 intermediate demand rose 12.9 percent, the largest advance since 12- month data were first calculated in November 2010.

Stage 3 intermediate demand: The index for stage 3 intermediate demand moved up 0.6 percent in November after rising 1.1 percent in both October and September. In November, prices for total goods inputs to stage 3 intermediate demand increased 0.7 percent, and the index for total services inputs advanced 0.5 percent. Rising prices for grains, television advertising time sales, jet fuel, asphalt, hot rolled steel sheet and strip, and utility natural gas outweighed declines in the indexes for raw milk, slaughter poultry, and arrangement of freight and cargo transportation. For the 12 months ended in November, prices for stage 3 intermediate demand jumped 20.6 percent.

Stage 2 intermediate demand: The index for stage 2 intermediate demand advanced 2.5 percent in November, the eighth consecutive increase. In November, prices for total goods inputs to stage 2 intermediate demand climbed 4.5 percent, and the index for total services inputs moved up 0.6 percent. Increases in the indexes for natural gas, crude petroleum, industrial chemicals, iron and steel scrap, fuels and lubricants retailing, and utility natural gas outweighed falling prices for liquefied petroleum gas, arrangement of freight and cargo transportation, and primary nonferrous metals. For the 12 months ended in November, prices for stage 2 intermediate demand rose 28.1 percent, the largest advance since 12-month data were first calculated in November 2010.

Stage 1 intermediate demand: Prices for stage 1 intermediate demand moved up 1.5 percent in November, the largest increase since a 1.5-percent advance in June. In November, the index for total goods inputs to stage 1 intermediate demand rose 2.0 percent, and prices for total services inputs climbed 0.9 percent. Advances in prices for utility natural gas; securities brokerage, dealing, investment advice, and related services; industrial chemicals; grains; iron and steel scrap; and guestroom rental outweighed decreasing indexes for diesel fuel; hardware, building materials, and supplies retailing; and building materials, paint, and hardware wholesaling. For the 12 months ended in November, prices for stage 1 intermediate demand jumped 20.8 percent.

PPI Publishes Interim Index Values and Publishes All Indexes to 3 Decimal Places

Effective with this report of Producer Price Index (PPI) data, the Bureau of Labor Statistics began publishing interim index values for all preliminary PPI data, starting with values for August through October 2021. Within PPI, interim indexes are defined as recalculated indexes for the 3 months between the initial publication and final revision of PPI data. With this modification, data within the 3-month interim revision period is being updated and published on a monthly basis. This replaces the prior policy of only publishing revised data once, when the data were finalized 4 months after original publication. PPI data will continue to be finalized 4 months after initial publication.

The publication of interim index values allows for greater transparency regarding PPI revisions, and aligns PPI official index publication with Bureau of Economic Analysis use of PPI interim index data as an input to Gross Domestic Product calculations.

In addition, effective with the November 2021 data release in December 2021, the PPI began publishing index values to 3 decimal places of precision, starting with finalized data for July 2021. The publication of index levels to 3 decimal places allows data users greater precision in percent change calculations. Published PPI percent change calculations continue to be rounded to one decimal place. The change to 3 decimal precision for indexes applies to all PPI data: Industry, Commodity, FD-ID, and Input indexes.

This change to the level of published precision impacts only the presentation of index numbers. Index values continue to be calculated from underlying price information in the same manner as in the past, and no systematic upward or downward effect on the data has been introduced. With the implementation of this change, official PPI data prior to July 2021 have not been revised to reflect greater precision.

As a result of the publication of interim index values and index data to 3 decimal places of precision, effective with the publication of November 2021 PPI data in December 2021, PPI introduced redesigned publication tables for both the PPI News Release and the PPI Detailed Report. For further information on these publication table changes see: www.bls.gov/ppi/notices/2021/ppi-to-publish-interim-index-values-to-3-decimal-places.htm, or contact the PPI Section of Index Analysis and Public Information at ppi-info@bls.gov or (202) 691-7705.

Recalculated Seasonal Adjustment Factors and Relative Importance Figures to be Available on February 11, 2022

Each year with the release of PPI data for January, seasonal adjustment factors and relative importance figures are recalculated to reflect price movements from the just-completed calendar year. The following seasonal information will be available on February 11, 2022 (2 workdays prior to the release of PPI data for January 2022 on February 15, 2022):

* Direct seasonal factors for PPI commodity indexes for the year 2022, * Recalculated seasonal factors for the last 5 years (2017-2021) for PPI commodity indexes, * Recalculated seasonal factors for the last 5 years (2017-2021) for PPI Final Demand- Intermediate Demand indexes, * Recalculated seasonal index data for the last 5 years (2017-2021) for Final Demand- Intermediate Demand and commodity indexes. This revision to seasonally adjusted indexes for the previous 5 years will be posted to the PPI database on the BLS website.

In addition, the following relative importance tables, which include values for December 2021, will be available on February 11, 2022:

* Final demand by individual commodities * Final demand by component series * Individual commodities of intermediate demand by commodity type * Component series of intermediate demand by commodity type * Individual commodities of intermediate demand by production flow * Component series of intermediate demand by production flow * Commodities, all levels * Wherever-provided services and construction

This information will be available on the PPI website at www.bls.gov/ppi or by contacting the PPI Section of Index Analysis and Public Information at ppi-info@bls.gov or (202) 691-7705.