The Canadian Industrial Product Price Index rose 1 percent in February, mainly because of higher prices for energy and petroleum products. The Raw Materials Price Index increased 5.7 percent, led by crude energy products.
IPPI Monthly Change
The IPPI increased 1 percent in February, following a 1.4 percent gain in January. It was the fourth consecutive monthly advance. The increase in the IPPI was broad-based, as 16 of the 21 major commodity groups were up.
The growth of the IPPI was mainly attributable to higher prices for energy and petroleum products (up 2.4 percent). Motor gasoline (up 2.5 percent) and diesel fuel (up 4.1 percent) led the increase in this commodity group. The IPPI excluding energy and petroleum products was up 0.8 percent in February.
Chemicals and chemical products (up 2.1 percent) also contributed to the increase in the IPPI, influenced by higher prices for petrochemicals (up 7.9 percent). The chemicals and chemical products group has not declined since October 2013.
Motorized and recreational vehicles (up 0.7 percent) posted a fifth consecutive increase, mainly as a result of higher prices for passenger cars and light trucks (up 0.8 percent). The advance of the motorized and recreational vehicles index was closely linked to the depreciation of the Canadian dollar relative to the US dollar.
Some Canadian producers who export their products report their prices in US dollars. Consequently, the 1 percent decrease in the value of the Canadian dollar relative to the US dollar may have had the effect of increasing the IPPI. Without the measurable effect of the exchange rate, the index would have risen 0.8 percent instead of 1 percent.
To a lesser extent, meat, fish, and dairy products (up 1.4 percent) and primary non-ferrous metal products (up 1.2 percent) also exerted upward pressure on the IPPI.
Higher prices for meat products (up 2.1 percent), specifically fresh and frozen pork (up 8.8 percent), were mainly responsible for the advance of the meat, fish, and dairy product group.
The primary non-ferrous metal products group was led by higher prices for unwrought precious metals and precious metal alloys (up 3 percent), specifically silver (up 6 percent) and gold (up 3.9 percent).
IPPI 12-Month Change
The IPPI increased 1.8 percent during the 12-month period ending in February, after rising 2.3 percent in January.
Compared with February 2013, the growth of the IPPI was mainly attributable to higher prices for motorized and recreational vehicles (up 5.3 percent), specifically passenger cars and light trucks (up 5.9 percent). On a year-over-year basis, prices for motorized and recreational vehicles have been increasing since July 2013.
Energy and petroleum products (up 3.5 percent) also contributed to the year-over-year increase in the IPPI, as a result of higher prices for light fuel oils (up 9.7 percent) and diesel fuel (up 8.2 percent). The IPPI excluding energy and petroleum products rose 1.5 percent on a year-over-year basis.
Chemicals and chemical products were up 5.2 percent compared with February 2013, primarily because of higher prices for petrochemicals (up 13.6 percent).
To a lesser extent, meat, fish, and dairy products (up 3.4 percent) also contributed to the year-over-year increase in the IPPI, mostly as a result of higher prices for fresh and frozen pork.
Conversely, the growth of the IPPI over the 12-month period was moderated mainly by lower prices for primary non-ferrous metal products (down 8.1 percent), specifically unwrought precious metals and precious metal alloys (down 16.6 percent). On a year-over-year basis, primary non-ferrous metal products have been declining since December 2011.
RMPI Monthly Change
The RMPI rose 5.7 percent in February, after advancing 2.8 percent in January. This was the third consecutive monthly increase and the largest gain since June 2009.
Although all major commodity groups posted price increases compared with January, the growth of the RMPI was mostly attributable to crude energy products (up 9.4 percent). Conventional crude oil led the increase of this commodity group, up 9.8 percent. The RMPI excluding crude energy products increased 1.5 percent in February.
Animals and animal products (up1.9 percent) and crop products (up 3.4 percent) also contributed to the increase of the RMPI.
Live animals (up 3.6 percent), particularly hogs (up 8.8 percent), were responsible for the growth of the animals and animal products group. The increase of hog prices in February was partly attributable to the pork epidemic diarrhea virus in North America.
Other crop products (up 3.6 percent) as well as fresh fruit, nuts and vegetables (up 5.7 percent) contributed the most to the advance of the crop products group.
Among other commodity groups that posted gains were metal ores, concentrates and scrap (up 0.5 percent) as well as logs, pulpwood, natural rubber and other forestry products (up 0.7 percent).
RMPI 12-Month Change
The RMPI rose 3.9 percent during the 12-month period ending in February, after increasing 0.3 percent in January.
Compared with the same month a year earlier, the growth of the RMPI was mainly due to higher prices for crude energy products (up 12 percent), specifically conventional crude oil (up 11.9 percent). On a year-over-year basis, the RMPI excluding crude energy products was down 4.3 percent.
To a lesser extent, animals and animal products (up 3.8 percent) also contributed to the year-over-year increase in the RMPI, as a result of higher prices for live animals (up 8.3 percent), particularly cattle and calves (up 18.4 percent).
