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Industrial product and raw materials prices continue to rise

Ottawa, ON -- Manufacturers' prices were up 0.2% in September 2003, marking three consecutive months of increase, S...


Ottawa, ON — Manufacturers’ prices were up 0.2% in September 2003, marking three consecutive months of increase, Statistics Canada reports. Compared with September 2002, however, prices were down 2.6%, largely because of the continuing effect of a strong Canadian dollar against the U.S. dollar. Without the dollar’s influence, the Industrial Product Price Index (IPPI) would have risen 1.3% rather than falling 2.6% from a year ago.

On a monthly basis, lumber and other wood products were up 7.2% from August. Increasing prices for softwood lumber and particleboard were responsible for this rise, reflecting improved demand and a tight supply.

Higher prices for meat, fish and dairy products (+1.0%), chemical products (+0.8%) and fruit, vegetable and feed products (+0.7%) also contributed to the monthly increase in the IPPI.

Prices for motor vehicles and other transport equipment continued to fall (-0.9%), mainly because of the effect of the exchange rate. Lower prices were also observed for petroleum and coal products (-2.0%), pulp and paper products (-1.0%) and electrical and communication products (-0.8%).

On an annual basis, September was the sixth consecutive month of decline in the IPPI. Lower prices persisted for motor vehicles and other transport equipment (-9.4%), pulp and paper products (-5.2%), electrical and communication products (-6.9%) and primary metal products (-2.5%). These products remain the major contributors to the year-over-year decline in the IPPI.

On a monthly basis, raw materials prices (RMPI) were down 3.1% from August. Manufacturers paid 8.3% less for their raw materials than they did in September 2002, compared with a decrease of 2.8% in August.

The IPPI (1997=100) stood at 105.9 in September, up from its revised level of 105.7 in August. The RMPI (1997=100) was 107.7 in September, down from its revised level of 111.2 in August.