EconoIndicators / Producer Price Index

Producer Price Index At a Glance

Finished Goods Index: Up 0.6%
Finished Goods Core: Up 0.1%
Finished Goods Annual Change: Up 4.0%
Finished Goods Energy: Up 2.5%
Finished Goods Food: Down 0.1%
Intermediate Goods Index: Up 0.6%
Crude Goods Index: Up 1.2%

Technorati Tags: PPI, inflation, Producer Price Index

Producer Price Indexes — July 2007

The Producer Price Index for Finished Goods advanced 0.6 percent in
July, seasonally adjusted, the Bureau of Labor Statistics of the U.S.
Department of Labor reported today. This increase followed a 0.2-percent
decline in June and a 0.9-percent rise in May. At the earlier stages of
processing, prices received by manufacturers of intermediate goods rose 0.6
percent in July compared with a 0.5-percent gain in June, and the index for
crude materials climbed 1.2 percent subsequent to a 0.3-percent increase a
month earlier. (See table A.)

2006
July -0.1 0.1 0.7 -0.5 4.0 0.2 2.8
Aug. .4 1.2 -.5 .4 3.8 .4 2.6
Sept. -1.1 .4 -5.9 .3 .9 -1.3 -3.8
Oct. -1.5 -.4 -5.8 -.4 -1.2 -1.2 -9.2
Nov. 1.6 .1 5.4 .9 .9 .6 11.7
Dec. .7 1.1 2.4 .1 1.1 .9 2.6

2007
Jan. -.6 1.0 -4.3 .2 .1 -.7 -5.5
Feb. 1.2 1.7 3.0 .4 2.4 .8 9.0
Mar. 1.0 r 1.6 r 3.8 r -.1 r 3.1 r 1.2 r 2.6
Apr. r .8 r .5 r 3.2 r .1 3.2 r 1.0 r .6
May .9 -.2 4.1 .2 4.1 1.1 2.0
June -.2 -.8 -1.1 .3 3.3 .5 .3
July .6 -.1 2.5 .1 4.0 .6 1.2

r=revised. Some of the figures shown above and elsewhere in this release may differ
from those previously reported because data for March 2007 have been revised to
reflect the availability of late reports and corrections by respondents.

-2-

Among prices for finished goods, the index for energy goods rose 2.5
percent in July following a 1.1-percent decrease in June. Prices for
finished consumer foods inched down 0.1 percent after declining 0.8 percent
in the previous month. By contrast, slightly counteracting the upturn in
finished goods prices, the increase in the index for finished goods other
than foods and energy slowed to 0.1 percent from 0.3 percent in June.

Before seasonal adjustment, the Producer Price Index for Finished
Goods advanced 0.7 percent in July to 168.2 (1982 = 100). From July 2006
to July 2007, the finished goods index moved up 4.0 percent. Over the same
period, prices for finished energy goods jumped 6.6 percent, the index for
finished consumer foods rose 6.2 percent, and prices for finished goods
other than foods and energy increased 2.3 percent. For the 12-month period
ended in July, the index for intermediate goods advanced 4.1 percent, and
prices received by crude goods producers climbed 13.1 percent.

Finished goods

The finished energy goods index increased 2.5 percent in July compared
with a 1.1-percent decrease in June. Leading this upturn, prices for
gasoline advanced 3.2 percent following a 3.9-percent decline in the
previous month. The indexes for residential electric power and liquefied
petroleum gas also turned up in July. Prices for diesel fuel and kerosene
rose more than they had a month earlier. Conversely, slightly
counteracting the upturn in finished energy goods prices, the index for
lubricating and similar oils moved down 2.0 percent subsequent to a 0.3-
percent decline in June. (See table 2.)

2006
July 0.8 -1.1 0.5 8.7 2.2 3.7 1.5 6.2
Aug. -.4 .4 .4 8.8 .3 6.9 -3.4 5.1
Sept. .6 -6.0 0 4.7 1.8 -9.2 1.4 -8.2
Oct. .4 -5.9 -.1 .2 2.7 -20.1 -2.7 -21.1
Nov. 2.4 4.3 -.4 2.1 2.5 26.5 -.6 -10.5
Dec. 1.2 3.9 .1 2.8 -.1 4.8 1.7 -4.7

2007
Jan. 1.8 -3.7 0 1.1 2.4 -15.3 1.8 -9.5
Feb. 3.0 3.5 0 2.2 7.4 14.3 2.9 7.7
Mar. r 1.8 r 4.2 r .4 r 3.3 r 2.4 r .3 r 7.4 r 13.3
Apr. r 1.0 r .9 r 1.0 3.7 r 1.2 r -.1 r .1 11.1
May .1 4.2 .4 3.7 1.1 4.3 .1 11.5
June 1.6 .3 .4 3.7 .5 .6 -.2 14.8
July .8 2.0 .2 4.1 2.1 1.1 0 13.1

r=revised. Some of the figures shown above and elsewhere in this release may
differ from those previously reported because data for March 2007 have been
revised to reflect the availability of late reports and corrections by respondents.

-3-

Prices for finished consumer foods edged down 0.1 percent in July
after falling 0.8 percent in June. The index for fresh fruits and melons
decreased 10.2 percent subsequent to a 14.9-percent decline a month
earlier. Prices for eggs for fresh use, processed young chickens, soft
drinks, and for finfish and shellfish turned up in July. The index for
fresh and dry vegetables rose more than it had in the preceding month.
Conversely, prices for beef and veal moved down 8.4 percent following a 3.3-
percent decline in the prior month. The pork index also decreased at a
faster rate compared with a month earlier. Prices for dairy products
increased less than they had in June, while the canned meats index turned
down in July.

The index for finished goods less foods and energy edged up 0.1
percent in July after increasing 0.3 percent a month earlier. Prices for
passenger cars moved up 0.2 percent subsequent to a 1.4-percent gain in
June. The indexes for alcoholic beverages, civilian aircraft, and
household furniture turned down in July. Prices for sanitary papers and
health products were unchanged after moving up in the previous month. By
contrast, prices for pharmaceutical preparations increased 0.5 percent
after inching down 0.1 percent in June. The indexes for commercial
furniture, cosmetics and other toilet preparations, and tires also turned
up in July. Prices for light motor trucks increased more than they had in
June.

Intermediate goods

The index for Intermediate Materials, Supplies, and Components
increased 0.6 percent in July after advancing 0.5 percent in June. Among
prices for intermediate goods in July, increases for energy goods,
materials for nondurable manufacturing, foods and feeds, and materials and
components for construction outweighed decreases for materials for durable
manufacturing. The index for intermediate goods less foods and energy
moved up 0.2 percent after advancing 0.4 percent in June. (See table B.)

Prices for intermediate energy goods increased 2.0 percent in July
after rising 0.3 percent in the prior month. The diesel fuel index moved
up 6.8 percent following a 0.4-percent advance in June. Prices for
residual fuel also rose more than they had in the previous month. The
indexes for gasoline, jet fuels, and liquefied petroleum gas turned up in
July. Prices for industrial electric power were unchanged after falling in
June. By contrast, partially counteracting the acceleration in the
intermediate energy goods index, prices for natural gas to electric
utilities decreased 2.1 percent following a 7.8-percent advance in the
preceding month. The indexes for both commercial and industrial natural
gas and for commercial electric power also turned down in July. (See
table 2.)

The materials for nondurable manufacturing index advanced 1.1 percent
in July after climbing 1.8 percent a month earlier. Price increases for
inedible fats and oils slowed to 2.1 percent from 7.4 percent in June. The
indexes for fertilizer materials, processed yarns and threads, and gray
fabrics also rose less than in the previous month. Prices for intermediate
basic organic chemicals and finished fabrics turned down in July. The
index for synthetic fibers fell following no change in June. By contrast,
the increase in the index for plastic resins and materials accelerated to
1.4 percent after advancing 0.8 percent a month earlier. Prices for
alkalies and chlorine and for paper also rose more in July. The index for
paint materials turned up after falling in June.

The rate of increase in the index for intermediate foods and feeds
slowed from 1.6 percent in June to 0.8 percent in July. Prices for
natural, processed, and imitation cheese moved up 1.9 percent after
increasing 9.6 percent in June. The indexes for flour and for dry,
condensed, and evaporated milk products also rose less in July than they
had in the previous month. Prices for beef and veal and for pork fell more
in July. By contrast, the index for processed young chickens turned up 0.3
percent following a 4.5-percent decline in June. Prices for shortening and
cooking oils and for fluid milk products rose more in July than in the
prior month.

-4-

The index for materials and components for construction rose 0.2
percent in July following a 0.4-percent gain in the prior month. Price
increases for nonferrous wire and cable, cast iron pressure and soil pipe
fittings, softwood lumber, treated wood, building paper and board, and for
paving mixtures and blocks more than offset declining prices for steel mill
products, gypsum products, asphalt felts and coatings, and fabricated
structural metal products.

Prices for materials for durable manufacturing declined 0.5 percent in
July after increasing 0.3 percent in June. The index for semifinished
steel mill products decreased 5.3 percent following a 2.1-percent rise in
the preceding month. Prices for hot rolled steel sheet and strip fell in
July after no change, while the index for cold rolled steel sheet and strip
was unchanged following an increase in June. Prices for secondary aluminum
and cement turned down in July after rising a month earlier. Conversely,
the index for primary nonferrous metals advanced 2.8 percent following a
2.2-percent decrease in June. Prices for building paper and board and for
softwood lumber moved up at quicker rates in July than they had in the
prior month. The index for hot rolled steel bars, plates, and structural
shapes turned up after falling in June.

Crude goods

The Producer Price Index for Crude Materials for Further Processing
increased 1.2 percent in July following a 0.3-percent gain in the preceding
month. Prices for crude foodstuffs and feedstuffs and for crude energy
material rose more than they had in June. The basic industrial materials
index showed no change after declining in the previous month. (See table
B.)

Prices for crude foodstuffs and feedstuffs advanced 2.1 percent in
July following a 0.5-percent rise in the prior month. The slaughter cattle
index increased 1.1 percent compared with a 7.7-percent drop in June.
Prices for slaughter broilers and fryers, alfalfa hay, and unprocessed
finfish also turned up in July. The index for soybeans rose more than it
had in the preceding month. By contrast, partially counteracting the
acceleration in crude foodstuffs and feedstuffs prices, the index for corn
declined 12.8 percent in July subsequent to a 6.8-percent advance in the
previous month. The indexes for fluid milk, wheat, and slaughter hogs
increased less than they had in June. (See table 2.)

Prices for crude energy materials moved up 1.1 percent in July after
increasing 0.6 percent a month earlier. The index for crude petroleum
jumped 11.8 percent following a 2.9-percent rise in the prior month. Coal
prices moved up 1.7 percent after increasing 1.1 percent in June. By
contrast, the index for natural gas fell 6.4 percent in July following a
1.2-percent decline in the preceding month.

Prices for crude nonfood material less energy were unchanged in July
after edging down 0.2 percent in the previous month. The wastepaper index
advanced 11.1 percent following a 0.8-percent decrease in the prior month.
The indexes for copper base scrap and raw cotton also turned up in July.
Prices for gold ores decreased less than they had in the preceding month.
The indexes for construction, sand, gravel, and crushed stone and for
aluminum base scrap increased after no change in June. By contrast, the
iron and steel scrap index decreased 4.7 percent in July compared with a
1.4-percent advance in the prior month. Prices for hides and skins fell
more than they had in the preceding month.

-5-

Net output price indexes

Mining, Utilities, and Manufacturing Industries. The Producer Price Index
for the Net Output of Total Mining, Utilities, and Manufacturing Industries
climbed 0.8 percent in July after advancing 0.2 percent in June. (Net
output price indexes are not seasonally adjusted.) Most of this faster
rate of increase is attributable to prices received by petroleum and coal
products manufacturers, which jumped 5.0 percent in July following a 3.1-
percent drop a month earlier. The industry indexes for printing and
related support activities, furniture and related product manufacturing,
and textile product mills also turned up after falling in June. By
contrast, partially offsetting the acceleration in overall mining,
utilities, and manufacturing prices, the index for electric power
distribution moved up 1.0 percent in July compared with a 3.3-percent
increase in June. Prices received by food manufacturers also advanced less
than they had in the prior month. The index for the natural gas
distribution industry turned down after rising in June, while prices
received by transportation equipment manufacturers decreased in July
following no change in the previous month.

Trade Industries. The Producer Price Index for the Net Output of Total
Trade Industries rose 0.7 percent in July after falling 1.2 percent in
June. (Trade indexes measure changes in margins received by wholesalers
and retailers.) Margins received by merchant wholesalers of durable goods
moved up 1.6 percent in July following a 4.1-percent drop a month earlier.
Similarly, the margin indexes for merchant wholesalers of nondurable goods,
grocery stores, and for electronics and appliance stores also turned up
after decreasing in June. Margins received by miscellaneous general
merchandise stores climbed at faster rates in July than they had in the
prior month, while the margin index for gasoline stations declined less
than it had in June. By contrast, margins received by electronic shopping
and mail order houses fell 7.9 percent in July after increasing 1.2 percent
in the preceding month. The margin indexes for department stores, shoe
stores, and wholesale trade agents and brokers also turned down following
advances in June.

Transportation and Warehousing Industries. The Producer Price Index for
the Net Output of Total Transportation and Warehousing Industries climbed
1.3 percent in July after rising 0.8 percent in June. Most of this
acceleration can be traced to prices received by the industry for scheduled
air transportation, which jumped 5.4 percent in July following a 3.6-
percent gain in the previous month. The industry indexes for pipeline
transportation of crude oil and refined petroleum products both advanced
after no change in June. Prices for deep sea freight transportation and
for long-distance, general freight trucking turned up in July after falling
in the prior month. By contrast, prices received by line-haul railroads
were unchanged in July following a 0.9-percent increase in June. The
industry indexes for inland water freight transportation and for couriers
moved up at slower rates in July than they had in the preceding month.

Traditional Services Industries. The Producer Price Index for the Net
Output of Total Traditional Service Industries decreased 0.2 percent in
July after rising 0.7 percent in June. Prices received by the commercial
banking industry dropped 4.9 percent following a 4.7-percent advance in the
prior month. The indexes for savings institutions and offices of
physicians (excluding mental health) also turned down in July. Prices
received by non-casino hotels and motels and lessors of nonresidential
buildings (excluding miniwarehouses) moved up at slower rates than they had
in June. By contrast, the index for cellular and other wireless carriers
increased 2.8 percent in July after falling 2.2 percent in the previous
month. Prices received by the securities brokerage industry also turned
up. The index for portfolio managers climbed in July following no change a
month earlier, while prices received by software publishers were unchanged
after declining in June.

*****

Producer Price Index data for August 2007 are scheduled to be released on
Tuesday, September 18, 2007 at 8:30 a.m. (EDT).

-6-

Resampling of Industries

Effective with this release, the Producer Price Index (PPI) includes
data for 84 resampled and 2 newly introduced industries classified
according to the North American Industry Classification System (NAICS).
The Bureau of Labor Statistics periodically updates the sample of producers
providing data for the PPI to reflect current conditions more accurately
when the structure, membership, technology, or product mix of an industry
shifts. The first results of this systematic process were published in
July 1986. Subsequent efforts have been completed at 6-month intervals.
For information on specific index additions, deletions, and recodes
that are effective with this semiannual update, see the July 2007 issue of
the PPI Detailed Report online at http://www.bls.gov/ppi/ppidr200707.pdf,
or contact the Division of Industrial Prices and Price Indexes, Section of
Index Analysis and Public Information at ppi-info@bls.gov or (202) 691-
7705.

NAICS
Code Industry

212324 Kaolin and Ball Clay Mining
212325 Clay, Ceramic, and Refractory Minerals Mining
212391 Potash, Soda, and Borate Mineral Mining
213114 Support Activities for Metal Mining
213115 Support Activities for Nonmetallic Minerals (except Fuels)
Mining
311811 Retail Bakeries
311930 Flavoring Syrup and Concentrate Manufacturing
311941 Mayonnaise, Dressing, and Other Prepared Sauce
Manufacturing
311942 Spice and Extract Manufacturing
312111 Soft Drink Manufacturing
313312 Textile and Fabric Finishing (except Broadwoven Fabric)
Mills
315211 Men’s and Boys’ Cut and Sew Apparel Contractors
315212 Women’s, Girls’, and Infants’ Cut and Sew Apparel
Contractors
315228 Men’s and Boys’ Cut and Sew Other Outerwear Manufacturing
315239 Women’s and Girls’ Cut and Sew Other Outerwear
Manufacturing
315292 Fur and Leather Apparel Manufacturing
321992 Prefabricated Wood Building Manufacturing
322121 Paper (except Newsprint) Mills
322122 Newsprint Mills
322130 Paperboard Mills
322222 Coated and Laminated Paper Manufacturing
322223 Plastics, Foil, and Coated Paper Bag Manufacturing
322226 Surface-Coated Paperboard Manufacturing
322231 Die-Cut Paper and Paperboard Office Supplies Manufacturing
322299 All Other Converted Paper Product Manufacturing
325110 Petrochemical Manufacturing
325611 Soap and Other Detergent Manufacturing
325612 Polish and Other Sanitation Good Manufacturing
325620 Toilet Preparation Manufacturing
325992 Photographic Film, Paper, Plate, and Chemical Manufacturing
326111 Plastics Bag Manufacturing
326112 Plastics Packaging Film and Sheet (including Laminated)
Manufacturing
326113 Unlaminated Plastics Film and Sheet (except Packaging)
Manufacturing
326199 All Other Plastics Product Manufacturing
327320 Ready-Mix Concrete Manufacturing
327331 Concrete Block and Brick Manufacturing
327332 Concrete Pipe Manufacturing
327390 Other Concrete Product Manufacturing
327420 Gypsum Product Manufacturing

-7-

Resampling of Industries-Continued

327910 Abrasive Product Manufacturing
327993 Mineral Wool Manufacturing
332116 Metal Stamping
332214 Kitchen Utensil, Pot, and Pan Manufacturing
332311 Prefabricated Metal Building and Component Manufacturing
332321 Metal Window and Door Manufacturing
332510 Hardware Manufacturing
332813 Electroplating, Plating, Polishing, Anodizing, and Coloring
332913 Plumbing Fixture Fitting and Trim Manufacturing
333120 Construction Machinery Manufacturing
333295 Semiconductor Machinery Manufacturing
333313 Office Machinery Manufacturing
333314 Optical Instrument and Lens Manufacturing
333315 Photographic and Photocopying Equipment Manufacturing
333319 Other Commercial and Service Industry Machinery
Manufacturing
333515 Cutting Tool and Machine Tool Accessory Manufacturing
333995 Fluid Power Cylinder and Actuator Manufacturing
333999 All Other Miscellaneous General Purpose Machinery
Manufacturing
334113 Computer Terminal Manufacturing
334119 Other Computer Peripheral Equipment Manufacturing
334210 Telephone Apparatus Manufacturing
334220 Radio and Television Broadcasting and Wireless
Communications Equipment Manufacturing
334416 Electronic Coil, Transformer, and Other Inductor
Manufacturing
334514 Totalizing Fluid Meter and Counting Device Manufacturing
334516 Analytical Laboratory Instrument Manufacturing
335212 Household Vacuum Cleaner Manufacturing
335228 Other Major Household Appliance Manufacturing
335311 Power, Distribution, and Specialty Transformer
Manufacturing
336321 Vehicular Lighting Equipment Manufacturing
336322 Other Motor Vehicle Electrical and Electronic Equipment
Manufacturing
337124 Metal Household Furniture Manufacturing
339991 Gasket, Packing, and Sealing Device Manufacturing
339994 Broom, Brush, and Mop Manufacturing
441110 New Car Dealers
481111 Scheduled Passenger Air Transportation
481112 Scheduled Freight Air Transportation
488119 Other Airport Operations
488190 Other Support Activities for Air Transportation
515210 Cable and Other Subscription Programming
517212 Cellular and Other Wireless Telecommunications
523920 Portfolio Management
524114 Direct Health and Medical Insurance Carriers
532111 Passenger Car Rental
532120 Truck, Utility Trailer, and RV (Recreational Vehicle)
Rental and Leasing
562111 Solid Waste Collection
611420 Computer Training*
811310 Commercial Machinery Maintenance and Repair*