Producer Price Indexes - October 2004

The Bureau of Labor Statistics of the U.S. Department of Labor reported today that the seasonally adjusted Producer Price Index for Finished Goods advanced 1.7 percent in October. This gain followed a 0.1-percent rise in September and a 0.1-percent decrease in August. At the earlier stages of processing, prices received by the manufacturers of intermediate goods went up 0.9 percent, after increasing 0.1 percent in the prior month. The index for crude materials turned up 4.3 percent in October, compared with a decline of 4.2 percent in September.

Among finished goods, prices for energy goods turned up 6.8 percent in October, following a 0.9-percent decline in September. The finished consumer foods index rose 1.6 percent, compared with a 0.1-percent increase in the prior month. By contrast, prices for finished goods other than foods and energy advanced 0.3 percent in October, the same rate of increase as in September.

Before seasonal adjustment, the Producer Price Index for Finished Goods increased 2.2 percent in October to 151.9 (1982=100). From October 2003 to October 2004, prices for finished goods advanced 4.4 percent. Over the same period, prices for finished energy goods went up 17.2 percent, the index for finished goods other than foods and energy climbed 1.8 percent, and the index for finished consumer foods rose 2.5 percent. Prices for intermediate goods moved up 9.0 percent during the 12-month period ended October 2004, and the crude goods index jumped 15.7 percent.

Finished goods

Prices for finished consumer foods rose 1.6 percent in October, compared with a 0.1-percent gain in the preceding month. A 34.2-percent upsurge in October's fresh and dry vegetables index followed a 12.1-percent increase in September and led the acceleration in the finished consumer foods index. Prices for beef and veal, pork, soft drinks, dairy products, and processed fruits and vegetables rose in October, compared with decreases in the prior month. The index for processed young chickens fell less in October than it did in September. By contrast, price increases slowed from 23.1 percent in September to 11.3 percent in October for fresh fruits and melons. The indexes for bakery products and eggs for fresh use turned down, after increasing in the previous month.

Prices for finished consumer goods other than foods and energy advanced 0.2 percent in October, after rising 0.4 percent in the previous month. The index for passenger cars decreased 1.3 percent, compared with a 1.1-percent gain in September. For the 12 months ended in October 2004, passenger car prices increased 1.1 percent. In accordance with usual practice, most new model year passenger cars and light trucks were introduced into the PPI in October. (See Report on Quality Changes for 2005 Model Vehicles, USDL 04-2351.) Prices for book publishing and pharmaceutical preparations also turned down in October. The indexes for mobile homes; women's, girls', and infants' apparel; and soaps and synthetic detergents moved up at a slower pace in October than they did in the prior month. Alternatively, prices for light motor trucks posted a 2.7-percent gain, after edging up 0.2 percent in September. From October 2003 to October 2004, prices for light motor trucks increased 0.3 percent. Household furniture prices rose more in October than they did in the prior month. The index for men's and boys' apparel increased, after showing no change in the previous month.

The capital equipment index moved up 0.4 percent in October, the same rate of increase as in September. In October, rising prices for light motor trucks, construction machinery, civilian aircraft, agricultural machinery, and integrating and measuring instruments outweighed decreasing prices for passenger cars, heavy motor trucks, electronic computers, metal cutting machine tools, and textile machinery.

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