Producer Price Index News Release text

Transmission of material in this release is embargoed until                          USDL 16-1196 
8:30 a.m. (EDT), Wednesday, June 15, 2016

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                              PRODUCER PRICE INDEXES - MAY 2016


The Producer Price Index for final demand increased 0.4 percent in May, seasonally adjusted, the 
U.S. Bureau of Labor Statistics reported today. Final demand prices rose 0.2 percent in April and 
declined 0.1 percent in March. On an unadjusted basis, the final demand index inched down 0.1 
percent for the 12 months ended in May. (See table A.)

In May, over 60 percent of the advance in the final demand index can be traced to prices for final 
demand goods, which climbed 0.7 percent. The index for final demand services moved up 0.2 
percent.

Prices for final demand less foods, energy, and trade services edged down 0.1 percent in May 
after rising 0.3 percent in April. For the 12 months ended in May, the index for final demand less 
foods, energy, and trade services increased 0.8 percent. 

Final Demand

Final demand goods: The index for final demand goods rose 0.7 percent in May, the largest 
advance since a 1.2-percent jump in May 2015. Two-thirds of the May 2016 increase can be 
traced to prices for final demand energy, which climbed 2.8 percent. The indexes for final 
demand goods less foods and energy and for final demand foods both moved up 0.3 percent.

Product detail: Over one-third of the increase in the index for final demand goods is attributable 
to gasoline prices, which advanced 6.6 percent. Prices for diesel fuel, iron and steel scrap, fresh 
and dry vegetables, jet fuel, and oilseeds also moved higher. In contrast, the index for beef and 
veal fell 5.2 percent. Prices for electric power and for carpets and rugs also decreased. (See table 
4.)

Final demand services: The index for final demand services rose 0.2 percent in May after 
inching up 0.1 percent in April. The May increase can be traced to margins for final demand 
trade services, which advanced 1.2 percent. (Trade indexes measure changes in margins received 
by wholesalers and retailers.) Conversely, prices for final demand services less trade, 
transportation, and warehousing and for final demand transportation and warehousing services 
fell 0.2 percent and 0.6 percent, respectively. 

Product detail: Leading the rise in prices for final demand services, margins for machinery and 
equipment wholesaling advanced 3.6 percent. The indexes for apparel, jewelry, footwear, and 
accessories retailing; inpatient care; residential property brokerage fees and commissions; 
flooring and floor coverings retailing; and legal services also increased. In contrast, prices for 
loan services (partial) declined 3.0 percent. The indexes for food retailing and airline passenger 
services also moved lower.

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

2015

May

0.5 0.0 1.2 1.1 5.7 0.1 0.0 0.2 -0.1 -0.1 -0.8 0.7

June

0.3 0.3 0.5 0.4 0.7 0.4 0.3 0.3 0.2 0.3 -0.5 0.8

July

0.1 0.1 -0.3 -0.8 -0.7 0.0 0.3 0.6 -0.1 0.1 -0.7 0.9

Aug.

-0.2 0.0 -0.5 0.2 -2.6 -0.2 -0.1 -0.4 -0.9 0.2 -1.0 0.6

Sept.

-0.5 -0.1 -1.0 -0.3 -5.3 0.0 -0.1 0.2 0.0 -0.2 -1.1 0.5

Oct.

-0.2 -0.2 -0.3 -0.7 -0.2 -0.3 -0.2 -0.2 -0.1 -0.1 -1.4 0.4

Nov.

0.1 0.1 -0.1 -0.3 0.1 -0.1 0.1 0.1 0.1 0.1 -1.3 0.2

Dec.

-0.1 0.1 -0.6 -0.9 -3.5 0.1 0.3 0.4 -0.8 0.2 -1.1 0.3

2016

Jan.(1)

0.4 0.3 -0.5 0.9 -4.3 0.1 0.9 1.7 0.5 0.6 0.0 0.8

Feb.(1)

-0.4 0.1 -0.7 -0.3 -3.9 0.1 -0.3 -1.0 -0.6 0.2 0.0 0.9

Mar.

-0.1 0.0 0.2 -0.9 1.8 0.1 -0.2 -0.5 -0.3 -0.1 -0.1 0.9

Apr.

0.2 0.3 0.2 -0.3 0.2 0.3 0.1 -0.1 -0.4 0.3 0.0 0.9

May

0.4 -0.1 0.7 0.3 2.8 0.3 0.2 1.2 -0.6 -0.2 -0.1 0.8

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for January 2016 have been revised to reflect the availability of late reports and corrections by respondents.

Intermediate Demand by Commodity Type

Within intermediate demand in May, prices for processed goods advanced 0.8 percent, the index for 
unprocessed goods increased 1.3 percent, and prices for services fell 0.2 percent. (See tables B and 
C.)

Processed goods for intermediate demand: The index for processed goods for intermediate 
demand climbed 0.8 percent in May, the largest increase since a 0.8-percent rise in May 2015. Half 
of the broad-based advance in May 2016 can be traced to prices for processed energy goods, which 
climbed 2.7 percent. The indexes for processed materials less foods and energy and for processed 
foods and feeds advanced 0.5 percent and 1.1 percent, respectively. For the 12 months ended in May, 
the index for processed goods for intermediate demand declined 4.6 percent.

Product detail: About one-third of the May rise in prices for processed goods for intermediate 
demand can be attributed to the diesel fuel index, which jumped 20.0 percent. Prices for primary 
basic organic chemicals, steel mill products, gasoline, prepared animal feeds, and jet fuel also moved 
higher. Conversely, the index for electric power fell 0.8 percent. Prices for beef and veal and for 
paving mixtures and blocks also declined. (See table 5.)

Unprocessed goods for intermediate demand: The index for unprocessed goods for intermediate 
demand advanced 1.3 percent in May, the third straight increase. In May, a 4.2-percent rise in prices 
for unprocessed nonfood materials less energy accounted for over three-quarters of the broad-based 
advance in the index for unprocessed goods for intermediate demand. Prices for unprocessed energy 
materials and for unprocessed foodstuffs and feedstuffs rose 0.9 percent and 0.1 percent, 
respectively. For the 12 months ended in May, the index for unprocessed goods for intermediate 
demand dropped 13.7 percent.

Product detail: Over half of the May advance in prices for unprocessed goods for intermediate 
demand can be attributed to the index for iron and steel scrap, which rose 16.2 percent. The indexes 
for oilseeds, corn, natural gas, fresh vegetables (except potatoes), and crude petroleum also moved 
higher. In contrast, the index for slaughter cattle declined 1.9 percent. Prices for slaughter barrows 
and gilts and for copper ores also fell.

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.)

2015

May

0.8 0.4 4.5 0.0 -6.7 3.1 1.3 7.4 0.1 -23.0

June

0.5 1.7 1.7 0.0 -6.2 0.3 -0.3 1.5 0.2 -22.0

July

-0.3 0.2 -1.0 -0.1 -6.5 -3.5 -2.1 -6.3 -1.5 -23.2

Aug.

-0.8 -0.5 -2.2 -0.5 -7.2 -3.5 0.8 -8.4 -3.9 -23.7

Sept.

-1.3 -1.8 -4.3 -0.5 -8.3 -2.2 -4.3 -1.0 -0.2 -25.7

Oct.

-0.4 -0.7 -1.0 -0.3 -7.7 -1.3 -1.4 -0.4 -2.3 -24.0

Nov.

-0.5 -0.9 -1.1 -0.2 -7.2 -4.3 -2.3 -7.6 -3.7 -26.4

Dec.

-1.1 -2.0 -4.0 -0.4 -6.6 -3.9 -3.0 -7.2 -0.9 -25.3

2016

Jan.(1)

-0.9 -0.7 -3.4 -0.4 -5.3 0.2 4.8 -6.0 -0.5 -17.5

Feb.(1)

-0.8 0.4 -3.5 -0.3 -5.6 -2.5 -2.5 -4.7 0.6 -16.8

Mar.

-0.2 -0.6 0.0 -0.1 -5.5 2.5 -0.1 6.1 2.1 -14.1

Apr.

0.3 -0.3 0.5 0.3 -4.6 2.6 -1.9 9.0 3.5 -12.3

May

0.8 1.1 2.7 0.5 -4.6 1.3 0.1 0.9 4.2 -13.7

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for January 2016 have been revised to reflect the availability of late reports and corrections by respondents.

Services for intermediate demand: The index for services for intermediate demand moved down 
0.2 percent in May following a 0.1-percent advance in April. The decline can be traced to prices for 
services less trade, transportation, and warehousing for intermediate demand, which fell 0.4 percent. 
Conversely, margins for trade services for intermediate demand increased 0.3 percent. The index for 
transportation and warehousing services for intermediate demand was unchanged. For the 12 months 
ended in May, the index for services for intermediate demand advanced 0.9 percent.

Product detail: Accounting for two-thirds of the drop in the index for services for intermediate 
demand, prices for loan services (partial) declined 3.0 percent. The indexes for metals, minerals, and 
ores wholesaling; securities brokerage, dealing, investment advice, and related services; investment 
banking; airline passenger services; and deposit services (partial) also moved lower. In contrast, 
margins for building materials, paint, and hardware wholesaling increased 2.2 percent. Prices for 
courier, messenger, and U.S. postal services and for legal services also advanced.

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.)

2015

May

-0.1 1.1 0.1 -0.6 1.8

June

0.1 -0.4 0.4 0.3 1.7

July

0.3 1.0 0.2 0.1 1.4

Aug.

0.2 -0.8 -0.3 0.6 1.6

Sept.

-0.5 -0.1 -0.2 -0.8 1.1

Oct.

-0.5 -0.3 -0.1 -0.6 0.2

Nov.

0.1 -0.4 0.1 0.2 0.4

Dec.

0.2 -1.0 -0.2 0.6 0.5

2016

Jan.(1)

1.3 0.5 -0.5 1.9 1.5

Feb.(1)

0.2 -0.1 -0.2 0.3 1.9

Mar.

-0.3 -1.1 -0.2 0.0 1.4

Apr.

0.1 0.4 -0.5 0.1 0.9

May

-0.2 0.3 0.0 -0.4 0.9

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for January 2016 have been revised to reflect the availability of late reports and corrections by respondents.

Intermediate Demand by Production Flow

Stage 4 intermediate demand: The index for stage 4 intermediate demand edged up 0.1 percent in 
May following a 0.3-percent increase in April. In May, prices for total goods inputs to stage 4 
intermediate demand rose 0.4 percent. Conversely, the index for total services inputs declined 0.2 
percent. (See table D.) Increases in the indexes for diesel fuel; gasoline; steel mill products; building 
materials, paint, and hardware wholesaling; and primary basic organic chemicals outweighed 
declines in the indexes for loan services (partial); metals, minerals, and ores wholesaling; electric 
power; and beef and veal. (See table 6.) For the 12 months ended in May, the index for stage 4 
intermediate demand moved down 1.1 percent.

Stage 3 intermediate demand: The index for stage 3 intermediate demand advanced 0.4 percent in 
May, the largest increase since a 1.2-percent jump in May 2015. In May 2016, prices for total goods 
inputs to stage 3 intermediate demand climbed 0.8 percent. In contrast, the index for total services 
inputs moved down 0.1 percent. Rising indexes for gasoline; jet fuel; primary basic organic 
chemicals; diesel fuel; steel mill products; and courier, messenger, and U.S. postal services 
outweighed falling prices for slaughter barrows and gilts, slaughter cattle, and loan services (partial). 
For the 12 months ended in May, the index for stage 3 intermediate demand decreased 5.1 percent.

Stage 2 intermediate demand: The index for stage 2 intermediate demand climbed 0.7 percent in 
May, the third consecutive increase. In May, prices for total goods inputs to stage 2 intermediate 
demand jumped 1.9 percent. Conversely, the index for total services inputs edged down 0.1 percent. 
Higher prices for oilseeds, gas fuels, steel mill products, prepared animal feeds, plastic resins and 
materials, and property and casualty insurance commissions outweighed decreases in the indexes for 
securities brokerage, dealing, investment advice, and related services; airline passenger services; and 
nonferrous wire and cable. For the 12 months ended in May, the index for stage 2 intermediate 
demand moved down 3.2 percent.

Stage 1 intermediate demand: The index for stage 1 intermediate demand rose 1.0 percent in May, 
the largest advance since a 1.5-percent rise in January 2014. In May, prices for total goods inputs to 
stage 1 intermediate demand jumped 2.2 percent. In contrast, the index for total services inputs 
declined 0.6 percent. Increases in the indexes for diesel fuel; iron and steel scrap; primary basic 
organic chemicals; steel mill products; gasoline; and building materials, paint, and hardware 
wholesaling outweighed decreases in the indexes for loan services (partial); metals, minerals, and 
ores wholesaling; and electric power. For the 12 months ended in May, the index for stage 1 
intermediate demand dropped 4.1 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

2015

May

0.3 0.6 0.0 1.2 2.3 0.0 0.8 2.1 -0.2 0.7 1.4 -0.2

June

0.2 0.3 0.0 0.3 0.4 0.1 0.3 0.3 0.2 0.5 0.6 0.1

July

0.0 -0.2 0.2 -0.4 -1.0 0.3 -0.7 -2.0 0.5 -0.2 -0.5 0.3

Aug.

-0.2 -0.4 0.2 -0.5 -1.1 0.2 -1.1 -3.0 0.3 -1.1 -1.7 -0.1

Sept.

-0.5 -0.8 -0.5 -1.8 -3.0 -0.4 -0.8 -1.2 -0.6 -1.5 -2.3 -0.6

Oct.

-0.3 -0.2 -0.5 -0.6 -1.0 -0.4 -0.4 -0.2 -0.6 -0.8 -0.9 -0.6

Nov.

-0.1 -0.2 0.2 -0.4 -0.7 0.0 -1.2 -2.9 0.0 -0.8 -1.4 0.0

Dec.

-0.4 -0.8 0.0 -0.9 -2.1 0.2 -0.5 -2.4 0.7 -1.4 -2.2 -0.4

2016

Jan.(1)

0.3 -0.3 1.0 0.1 -0.5 0.9 -0.3 -2.3 1.3 0.1 -1.2 1.5

Feb.(1)

-0.1 -0.4 0.1 -0.9 -2.2 0.3 -0.5 -2.0 0.3 -0.6 -1.1 0.1

Mar.

-0.3 -0.1 -0.5 0.0 0.3 -0.3 0.5 1.3 0.1 0.0 0.5 -0.6

Apr.

0.3 0.2 0.4 -0.1 -0.3 0.0 0.9 2.5 -0.2 0.7 1.1 0.3

May

0.1 0.4 -0.2 0.4 0.8 -0.1 0.7 1.9 -0.1 1.0 2.2 -0.6

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for January 2016 have been revised to reflect the availability of late reports and corrections by respondents.

_____________
The Producer Price Index for June 2016 is scheduled to be released on Thursday, July 14, 
2016 at 8:30 a.m. (EDT).

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Last Modified Date: June 15, 2016