Manufacturers’ prices weakened in June
Ottawa, ON -- Manufacturers' prices weakened 1.0% in June 2003 and fell 2.7% on an annual basis, largely due to the...
Ottawa, ON — Manufacturers’ prices weakened 1.0% in June 2003 and fell 2.7% on an annual basis, largely due to the strength of the Canadian dollar against the U.S. dollar, reports Statistics Canada.
The government agency notes that if the impact of the Canadian dollar were removed, the Industrial Product Price Index (IPPI) would have risen 1.2% rather than falling 2.7% from a year ago.
From a monthly perspective, lower prices for motor vehicles and other transport equipment (-2.1%), pulp and paper products (-1.8%) and primary metal products (-1.5%) were the major contributors in the decline of the IPPI. Prices for chemical products also fell (-1.3%), as well as those for electrical and communication products (-1.0%). Prices for lumber products were up 1.3% from May as a result of decreased production due to mill shutdowns.
On an annual basis, lower prices for motor vehicles and other transport equipment (-9.7%), lumber and other wood products (-7.9%) and electrical and communication products (-6.2%) were the major contributors to the year-over-year decline in the IPPI.
The petroleum and coal products group continues to be an influence on the year-over-year change in the IPPI, with an increase of 4.1%. If petroleum and coal product prices had been excluded, the IPPI would have declined 3.1% instead of decreasing 2.7% on a year-over-year basis.
In addition to petroleum and coal products, prices for chemical products (+3.1%), meat, fish and dairy products (+2.9%), tobacco products (+17.4%) as well as fruit, vegetable and feed products (+2.1%) were also up compared with a year ago.
On a monthly basis, raw materials prices were up 1.2% from May. Mineral fuels were the only contributors to the monthly increase in the Raw Materials Price Index (RMPI), with prices increasing 4.9%. Crude oil prices were 6.5% higher in June than in May, mainly the result of lower inventories. Lower prices for wood products, vegetable products, non-ferrous metals as well as ferrous materials partly offset the monthly increase. Prices for animal products were also down slightly (-0.2%) as price decreases for fresh fish and cattle were offset by increased prices for hogs.
<b>Raw material prices rise</b>
Manufacturers paid 3.2% more for their raw materials than they did in June last year, compared with a decrease of 0.6% in May. Higher prices for mineral fuels (+8.8%) were mainly responsible for this annual rise in the RMPI. On a year-over-year basis, crude oil prices were up 8.0%, following a year-over-year decrease of 3.9% in May.
Prices for animal products and non-metallic minerals were also up on an annual basis. These increases were partly offset by lower prices for wood products, non-ferrous metals, vegetable products and ferrous materials. If mineral fuels had been excluded, the RMPI would have decreased 1.0%.
The IPPI (1997=100) stood at 103.9 in June, down from its revised level of 104.9 in May. The RMPI (1997=100) was 114.3 in June, up from its revised level of 112.9 in May.