Producer Price Index News Release text

Transmission of material in this release is embargoed until                          USDL-14-1710
8:30 a.m. (EDT), Tuesday, September 16, 2014

Technical information:      (202) 691-7705  *  ppi-info@bls.gov  *  www.bls.gov/ppi
Media contact:              (202) 691-5902  *  PressOffice@bls.gov                                    
           
                        
                            PRODUCER PRICE INDEXES - AUGUST 2014


The Producer Price Index for final demand was unchanged in August, seasonally adjusted, the 
U.S. Bureau of Labor Statistics reported today. Final demand prices advanced 0.1 percent in July 
and 0.4 percent in June. On an unadjusted basis, the index for final demand increased 1.8 percent 
for the 12 months ended in August. (See table A.)

In August, a 0.3-percent rise in prices for final demand services offset a 0.3-percent decrease in 
the index for final demand goods.

Within intermediate demand, prices for processed goods fell 0.3 percent, the index for 
unprocessed goods declined 3.3 percent, and prices for services moved up 0.2 percent. (See 
tables B and C.)

Table A. Monthly and 12-month percent changes in selected final demand price indexes, seasonally adjusted
Month Total
final
demand
Final demand goods Final demand services Change
in final
demand
from 12
months
ago
(unadj.)
Total Foods Energy Less
foods
and
energy
Total Trade Transportation
and
warehousing
Other

2013

Aug.

-0.1 0.0 -0.6 0.7 0.0 -0.1 -0.6 0.1 0.2 1.7

Sept.

0.1 -0.1 -0.7 0.2 0.0 0.2 0.4 -0.1 0.1 1.1

Oct.

0.3 0.1 0.3 0.0 0.0 0.3 0.2 0.3 0.3 1.3

Nov.

0.0 -0.1 -0.2 -0.6 0.1 0.0 0.2 -0.5 0.1 1.1

Dec.

0.0 0.4 -0.2 1.2 0.4 -0.2 -1.0 1.6 0.1 1.2

2014

Jan.

0.3 0.5 0.7 0.6 0.5 0.1 0.0 -0.9 0.2 1.3

Feb.

0.2 0.2 0.7 -0.3 0.2 0.3 0.6 -0.4 0.1 1.2

Mar.

0.3 0.1 1.3 -0.2 -0.1 0.4 0.6 0.4 0.3 1.6

Apr.(1)

0.2 0.4 2.6 -0.2 0.2 0.0 -0.3 0.8 0.1 1.8

May(1)

0.1 -0.1 -0.5 -0.2 0.1 0.2 0.5 0.7 0.0 2.0

June

0.4 0.5 -0.2 2.1 0.1 0.3 0.2 0.3 0.3 1.9

July

0.1 0.0 0.4 -0.6 0.2 0.1 0.2 0.5 0.0 1.7

Aug.

0.0 -0.3 -0.5 -1.5 0.0 0.3 0.0 0.3 0.3 1.8

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for April 2014 have been revised to reflect the availability of late reports and corrections by respondents.

Final Demand

(Final demand includes goods, services, and construction which are sold for personal 
consumption, capital investment, government purchases, and export. See table 4 for product 
detail.)

Final demand services:  The final demand services index climbed 0.3 percent in August after 
inching up 0.1 percent in July. Eighty percent of the August advance can be traced to a 0.3-
percent rise in prices for final demand services less trade, transportation, and warehousing. The 
index for final demand transportation and warehousing services also increased 0.3 percent. 
Margins for final demand trade services were unchanged. (Trade indexes measure changes in 
margins received by wholesalers and retailers.)

Product detail:  Accounting for over 20 percent of the August advance in the index for final 
demand services, prices for loan services (partial) increased 1.7 percent. The indexes for traveler 
accommodation services; health, beauty, and optical goods retailing; hospital outpatient care; 
securities brokerage, dealing, and investment advice; and airline passenger services also moved 
higher. In contrast, prices for services related to securities brokerage and dealing fell 4.5 percent 
in August. The indexes for food and alcohol retailing and for truck transportation of freight also 
decreased. (See table 4.)

Final demand goods:  The index for final demand goods moved down 0.3 percent in August, 
the largest decrease since a 0.7-percent drop in April 2013. Over 80 percent of the August 
decline is attributable to prices for final demand energy, which fell 1.5 percent. The index for 
final demand foods decreased 0.5 percent. Prices for final demand goods less foods and energy 
were unchanged.  

Product detail:  Over a quarter of the decline in prices for final demand goods can be attributed 
to the gasoline index, which fell 1.4 percent. Prices for utility natural gas, chicken eggs, diesel 
fuel, electric power, and raw cotton also moved lower. Conversely, the index for potatoes surged 
28.0 percent. Prices for pharmaceutical preparations and jet fuel also advanced. 
 
Special grouping, Final demand less foods, energy, and trade:  The index for final demand 
less foods, energy, and trade services advanced 0.2 percent in August, the third consecutive 0.2-
percent increase. For the 12 months ended in August, prices for final demand less foods, energy, 
and trade services rose 1.8 percent. (The index for final demand less foods, energy, and trade 
services represents about two-thirds of final demand.)

Special grouping, Finished goods:  Prices for finished goods fell 0.3 percent in August, the 
largest decrease since a 0.6-percent decline in April 2013. (The finished goods index represents 
about two-thirds of final demand goods, through the exclusion of the weight for government 
purchases and exports. The finished goods index represents about one-quarter of overall final 
demand.) Most of the August decrease can be traced to the index for finished consumer energy 
goods, which fell 1.4 percent. Prices for finished consumer foods moved down 0.3 percent. In 
contrast, the index for finished goods less foods and energy edged up 0.1 percent. Within 
finished goods, falling prices for gasoline, residential natural gas, eggs for fresh use, home 
heating oil, pork, and fresh vegetables (except potatoes) outweighed rising prices for 
pharmaceutical preparations, potatoes, and processed fruits and vegetables.

Intermediate Demand

(Intermediate demand includes goods, services, and maintenance and repair construction sold to 
businesses, excluding capital investment. BLS publishes two parallel treatments of intermediate 
demand, each constructed from the identical set of commodity price indexes. The first treatment 
organizes commodities according to commodity type, and the second organizes commodities 
using a stage-based, production flow model. See the technical note for more information.)

Processed goods for intermediate demand: The index for processed goods for intermediate 
demand moved down 0.3 percent in August, the largest decrease since a 0.3-percent decline in 
November 2013. In August, prices for processed energy goods fell 1.7 percent, and the index for 
processed foods and feeds declined 0.8 percent. In contrast, the index for processed materials 
less foods and energy moved up 0.2 percent. For the 12 months ended in August, prices for 
processed goods for intermediate demand rose 1.3 percent. (See table B.)

Product detail:  In August, a 3.1-percent decrease in prices for diesel fuel accounted for over a 
third of the decline in the index for processed goods for intermediate demand. Prices also fell for 
utility natural gas, gasoline, lubricating oil base stocks, prepared animal feeds, and electric 
power. Conversely, the index for primary basic organic chemicals advanced 0.8 percent. Prices 
for plastic resins and materials and for jet fuel also moved up in August. (See table 5.)

Table B. Monthly and 12-month percent changes in selected intermediate demand price indexes for goods by commodity type, seasonally adjusted
Month Processed goods for intermediate demand Unprocessed goods for intermediate demand
Total Foods
and
feeds
Energy
goods
Less
foods
and
energy
Total,
change
from 12
months
ago
(unadj.)
Total Foodstuffs
and
feedstuffs
Energy
materials
Nonfood
materials
less
energy
Total,
change
from 12
months
ago
(unadj.)

2013

Aug.

0.0 -2.3 0.6 0.2 0.4 -1.4 -3.4 -0.5 0.0 1.9

Sept.

0.1 0.5 0.3 -0.1 -0.6 -0.1 -0.7 1.0 -1.2 0.5

Oct.

-0.1 -1.8 0.0 0.1 -0.8 -0.5 1.1 -1.8 -0.6 -0.5

Nov.

-0.3 -0.9 -0.9 -0.1 -0.4 -1.7 -0.6 -4.0 1.0 -3.0

Dec.

0.4 0.7 1.2 0.1 0.1 2.2 -0.6 5.3 1.1 -1.9

2014

Jan.

0.7 1.2 1.5 0.4 0.5 0.9 3.6 -1.7 1.8 -0.5

Feb.

0.3 1.0 0.2 0.4 -0.2 5.1 0.6 13.4 -1.2 5.1

Mar.

0.0 1.3 -0.4 -0.2 0.7 -0.2 7.2 -6.4 -0.5 5.3

Apr.(1)

0.0 3.1 -1.5 0.2 1.5 0.8 3.6 -2.5 1.6 6.5

May(1)

-0.1 -0.5 0.3 -0.2 1.3 0.0 -2.1 2.4 -0.5 4.4

June

0.4 -0.1 1.3 0.1 1.5 -0.9 -3.0 1.2 -1.1 3.9

July

0.1 0.4 -0.3 0.3 1.6 -2.7 -0.4 -6.4 0.0 0.9

Aug.

-0.3 -0.8 -1.7 0.2 1.3 -3.3 -3.4 -4.9 -0.7 -0.8

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for April 2014 have been revised to reflect the availability of late reports and corrections by respondents.

Unprocessed goods for intermediate demand:  The index for unprocessed goods for 
intermediate demand fell 3.3 percent in August, the largest decrease since a 3.3-percent decline 
in June 2012. The broad-based decrease in August was led by the index for unprocessed energy 
materials, which dropped 4.9 percent. Prices for unprocessed foodstuffs and feedstuffs and for 
unprocessed nonfood materials less energy fell 3.4 percent and 0.7 percent, respectively. For the 
12 months ended in August, the index for unprocessed goods for intermediate demand moved 
down 0.8 percent, the largest 12-month decrease since a 1.9-percent decline in December 2013.

Product detail: About 40 percent of the August decrease in prices for unprocessed goods for 
intermediate demand can be attributed to the index for natural gas, which dropped 12.6 percent. 
The indexes for slaughter barrows and gilts, crude petroleum, slaughter poultry, raw cotton, and 
slaughter steers and heifers also declined. In contrast, prices for corn advanced 2.6 percent. The 
indexes for potatoes and aluminum base scrap also moved up in August.

Services for intermediate demand:  The index for services for intermediate demand moved up 
0.2 percent in August, the third straight advance. Most of the August increase can be traced to 
prices for services less trade, transportation, and warehousing for intermediate demand, which 
rose 0.3 percent. Also contributing, but to a lesser extent, the index for transportation and 
warehousing services for intermediate demand moved up 0.2 percent. In contrast, margins for 
trade services for intermediate demand declined 0.2 percent. For the 12 months ended in August, 
the index for services for intermediate demand increased 1.6 percent. (See table C.) 

Product detail:  In August, over 60 percent of the increase in the index for services for 
intermediate demand can be traced to prices for business loans (partial), which rose 2.1 percent. 
The indexes for securities brokerage, dealing, and investment advice; engineering services; 
traveler accommodation services; paper and plastics wholesaling; deposit services (partial); and 
airline passenger services also moved higher. Conversely, margins for machinery and equipment 
parts and supplies wholesaling fell 0.6 percent in August. The indexes for services related to 
securities brokerage and dealing and for truck transportation of freight also decreased.

Table C. Monthly and 12-month percent changes in selected intermediate demand price indexes for services by commodity type, seasonally adjusted
Month Services for intermediate demand
Total Trade Transportation
and
warehousing
Other Total, change
from 12 months
ago (unadj.)

2013

Aug.

0.2 -0.3 0.3 0.3 2.1

Sept.

0.1 0.7 0.2 -0.1 1.8

Oct.

0.2 -0.3 0.3 0.2 1.2

Nov.

0.2 0.8 0.0 0.1 0.9

Dec.

-0.2 -0.5 0.5 -0.2 1.0

2014

Jan.

0.3 -0.2 -0.3 0.6 1.1

Feb.

0.2 0.1 0.9 0.0 1.4

Mar.

0.4 0.3 0.2 0.4 1.7

Apr.(1)

-0.2 -1.1 0.3 -0.1 1.0

May(1)

-0.3 0.3 0.3 -0.5 1.2

June

0.6 1.3 0.3 0.5 1.5

July

0.3 0.1 0.5 0.3 1.7

Aug.

0.2 -0.2 0.2 0.3 1.6

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for April 2014 have been revised to reflect the availability of late reports and corrections by respondents.

Intermediate Demand by Production Flow

Stage 4 intermediate demand (The stage 4 intermediate demand index measures price 
changes for products purchased by industries that primarily produce output sold to final 
demand.):  The index for stage 4 intermediate demand was unchanged in August after rising 0.2 
percent in July. In August, prices for total services inputs to stage 4 intermediate demand edged 
up 0.1 percent. In contrast, prices for total goods inputs decreased 0.2 percent. (See table D.) 
Increases in the indexes for securities brokerage, dealing, and investment advice; business loans 
(partial); architectural and engineering services; jet fuel; and building materials, paint, and 
hardware wholesaling offset declines in the indexes for diesel fuel, services related to securities 
brokerage and dealing, gasoline, parts and supplies for machinery and equipment wholesaling, 
and administrative and general management consulting services. (See table 6.) For the 12 months 
ended in August, prices for stage 4 intermediate demand rose 1.4 percent.

Stage 3 intermediate demand (The stage 3 intermediate demand index measures price 
changes for products purchased by industries that primarily produce output sold to industries 
classified in stage 4.):  Prices for stage 3 intermediate demand declined 0.7 percent in August, 
after increasing 0.6 percent a month earlier. In August, the index for total goods inputs to stage 3 
intermediate demand fell 1.3 percent. Conversely, the index for total services inputs advanced 
0.2 percent. Lower prices for slaughter barrows and gilts, slaughter poultry, diesel fuel, raw milk, 
slaughter steers and heifers, and administrative and general management consulting services 
outweighed increases in the indexes for business loans (partial), plastic resins and materials, and 
slaughter cows and bulls. For the 12 months ended in August, the index for stage 3 intermediate 
demand rose 2.9 percent.

Table D. Monthly percent changes in selected intermediate demand price indexes by production flow, seasonally adjusted
Month Stage 4 intermediate
demand
Stage 3 intermediate
demand
Stage 2 intermediate
demand
Stage 1 intermediate
demand
Total Goods
inputs
Services
inputs
Total Goods
inputs
Services
inputs
Total Goods
inputs
Services
inputs
Total Goods
inputs
Services
inputs

2013

Aug.

0.1 0.1 0.3 0.1 -0.1 0.3 -0.4 -0.9 0.2 0.3 0.4 0.4

Sept.

0.0 0.0 0.0 0.1 0.1 0.1 0.3 0.3 0.3 -0.2 -0.3 -0.1

Oct.

0.2 0.0 0.3 0.2 0.4 -0.1 -0.9 -1.4 -0.2 -0.1 -0.4 0.5

Nov.

0.0 -0.3 0.2 0.1 -0.1 0.2 -1.3 -2.5 0.3 0.2 0.2 0.2

Dec.

0.1 0.4 -0.1 0.0 0.2 -0.1 1.4 2.8 -0.3 0.5 0.8 0.0

2014

Jan.

0.3 0.5 0.2 1.1 1.5 0.5 0.3 0.1 0.6 1.2 2.1 0.1

Feb.

0.2 0.1 0.1 0.4 0.6 0.4 3.8 6.3 0.3 0.0 -0.2 0.3

Mar.

0.3 0.2 0.6 1.0 1.6 0.2 -2.0 -3.5 0.0 -0.3 -1.0 0.5

Apr.(1)

0.0 0.2 -0.3 0.3 0.6 -0.1 -0.4 -0.4 -0.3 -0.2 -0.1 -0.3

May(1)

-0.2 -0.2 -0.2 -0.3 -0.6 -0.1 0.3 0.8 -0.3 -0.4 -0.4 -0.4

June

0.5 0.3 0.6 0.1 0.0 0.3 0.4 0.3 0.6 0.5 0.4 0.6

July

0.2 0.1 0.3 0.6 0.7 0.4 -1.7 -3.1 0.2 0.7 0.7 0.5

Aug.

0.0 -0.2 0.1 -0.7 -1.3 0.2 -1.4 -2.5 0.1 -0.2 -0.4 0.3

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for April 2014 have been revised to reflect the availability of late reports and corrections by respondents.

Stage 2 intermediate demand (The stage 2 intermediate demand index measures price 
changes for products purchased by industries that primarily produce output sold to industries 
classified in stage 3.):  The index for stage 2 intermediate demand fell 1.4 percent in August 
following a 1.7-percent decrease in July. In August, prices for total goods inputs to stage 2 
intermediate demand dropped 2.5 percent. In contrast, the index for total services inputs inched 
up 0.1 percent. Falling prices for natural gas, crude petroleum, formula feeds, liquefied 
petroleum gas, raw cotton, and administrative and general management consulting services 
outweighed advances in the indexes for business loans (partial), corn, and paper and plastics 
wholesaling. For the 12 months ended in August, prices for stage 2 intermediate demand moved 
down 1.5 percent, the largest decline since a 1.7-percent decrease in September 2012.

Stage 1 intermediate demand (The stage 1 intermediate demand index measures price 
changes for products purchased by industries that primarily produce output sold to industries 
classified in stage 2.):  The index for stage 1 intermediate demand moved down 0.2 percent in 
August compared with a 0.7-percent advance in the previous month. In August, prices for total 
goods inputs to stage 1 intermediate demand declined 0.4 percent. Conversely, the index for total 
services inputs moved up 0.3 percent. Decreases in prices for industrial natural gas, services 
related to securities brokerage and dealing, diesel fuel, industrial electric power, commercial 
electric power, and gasoline outweighed advances in the indexes for securities brokerage, 
dealing, and investment advice; primary basic organic chemicals; and traveler accommodation 
services. For the 12 months ended in August, the index for stage 1 intermediate demand rose 1.7 
percent.
____________
The Producer Price Index for September 2014 is scheduled to be released on Wednesday, 
October 15, 2014 at 8:30 a.m. (EDT).




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Last Modified Date: September 16, 2014