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                                U.S. IMPORT AND EXPORT PRICE INDEXES
                                            - JULY 2008 -

   The U.S. Import Price Index increased 1.7 percent in July, the Bureau of Labor Statistics of the 
U.S. Department of Labor reported today, after a 2.9 percent rise in June.  Both petroleum and 
nonpetroleum prices contributed to the advance, increasing 4.0 percent and 0.9 percent, respectively.  
Export prices rose 1.4 percent in July following a 1.0 percent advance the previous month.

                           Percent changes in import and export price indexes
                                         by End Use category
                                      - not seasonally adjusted -

 

Import Goods
   
   Import prices increased 1.7 percent in July after rising between 2.8 and 3.1 percent in each of the 
previous four months.  Prices for overall imports jumped 21.6 percent for the year ended in July, the largest 
12-month increase for the index since first publication in September 1982.  Petroleum prices continued 
to trend upward, although the 4.0 percent advance in July was comparatively smaller than the average 
monthly increases recorded between February and June when petroleum prices rose 42.1 percent overall.  
The price index for petroleum advanced 79.2 percent over the past year.  Nonpetroleum prices also 
contributed to the July increase in overall import prices, rising 0.9 percent for the second consecutive 
month.  Prices for nonpetroleum imports increased 8.0 percent over the past 12 months.    
   
   The increase in nonpetroleum prices was led by a 2.2 percent advance in the price index for 
nonpetroleum industrial supplies and materials.  Continued price hikes for natural gas, chemicals, and 
metals factored into the increase.  Import foods, feeds, and beverages prices rose 1.5 percent in July after 
a 1.7 percent increase in June.  The July advance was driven by higher prices for meat and vegetables.        

   Prices for each of the major finished goods categories also were higher in July.  The price 
indexes for consumer goods and capital goods each rose 0.3 percent.  Higher furniture prices contributed 
to the increase in consumer goods prices while the rise in capital goods prices was led by a 0.8 percent 
advance in capital goods prices excluding computers which more than offset a 0.8 percent drop in 
computer prices.  Prices for automotive vehicles ticked up 0.1 percent in July.  

 
Export Goods 

   Export prices rose 1.4 percent in July following a 1.0 percent increase in June.  Prices for exports 
advanced 10.2 percent over the July 2007-2008 period, the largest year-over-year gain since the all 
exports index was first published in September 1983.  Higher prices for agricultural prices and 
nonagricultural prices each contributed to the annual increase in overall export prices as both indexes 
recorded the largest 12-month advance since these series were first published in March 1985.  
   
   Agricultural prices rose 6.7 percent in July and 39.9 percent over the past year, and both changes 
were driven by sharp increases in corn and soybeans prices.  The July advance was the largest one-month 
rise since the agricultural exports price index was first published monthly in December 1988.  
   
   Prices for nonagricultural exports advanced 0.8 percent for the month and 7.5 percent for the year 
ended in July.  The July increase in nonagricultural prices was driven by a 2.6 percent advance in the 
price index for nonagricultural industrial supplies and materials.  Higher prices for fuels, chemicals, and 
metals all contributed to the increase.    
   
   Prices for consumer goods and automotive vehicles also advanced in July, rising 0.4 percent and 
0.1 percent, respectively, after recording little movement the past two months.  In contrast, capital goods 
prices declined 0.2 percent in July after increases in each of the previous three months.  The decrease 
was led by falling computer prices which had risen in June.  Despite the July drop, prices for capital 
goods rose 2.0 percent over the past 12 months.
   
   
   
Imports by Locality of Origin 
	
   Import prices from China rose 0.9 percent in July following a 0.6 percent increase in June.  The 
July advance matched the largest one-month gain for the index.  Prices for imports from China increased 
5.3 percent for the July 2007-2008 period, which was also the largest annual rise since the index was 
first published in December 2003.
   
   The price index for imports from Japan advanced 0.5 percent in July, the largest monthly 
increase for the index since a similar rise of 0.5 percent in December 2003.  Import price from Japan 
rose 1.8 percent over the past year, which was the largest year-over-year gain since the index was up 2.0 
percent for the August 1999-2000 period.
   
   Prices for imports from Canada, Mexico, and the European Union were also up in July, rising 1.7 
percent, 1.4 percent, and 0.7 percent, respectively.  Rising fuel prices were the primary contributor to the 
rise in each index.    
   
   
Import and Export Services

   The index for import air passenger fares advanced 4.1 percent in July after an 18.3 percent jump 
the previous month.  Import air passenger fares were up 19.5 percent for the year ended in July.  Export 
air passenger fares increased 5.4 percent in July and rose 16.7 percent over the past 12 months.

   Import air freight prices rose 0.8 percent in July and increased 18.5 percent over the past year.  
Both advances were led by a sharp rise in European air freight prices, which increased 2.6 percent in July 
and 33.3 percent for the July 2007-2008 period.  Export air freight prices advanced 1.6 percent in July 
and rose 21.6 percent over the past 12 months.  European air freight prices were the largest factor for 
those increases as well, rising 2.4 percent for the month and 37.4 percent for the year ended in July.
   
   	
CONTENTS OF RELEASE

This news release includes the following tables:

Table 1    U.S. Import Price Indexes, by End Use
Table 2    U.S. Export Price Indexes, by End Use
Table 3    U.S. Import Price Indexes, by NAICS
Table 4    U.S. Export Price Indexes, by NAICS
Table 5    U.S. Import Price Indexes, by Harmonized System
Table 6    U.S. Export Price Indexes, by Harmonized System
Table 7    U.S. Import Price Indexes, by Locality of Origin
Table 8    U.S. International Price Indexes for Selected Transportation Services
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Import and Export Price Index data for August are scheduled for release on September 11 at 
8:30 A.M. (EDT)

                                             TECHNICAL NOTE


Import and Export Merchandise and Services Price Indexes -- All indexes use a modified Laspeyres 
formula and are not seasonally adjusted.  Price indexes for merchandise goods are reweighted annually, 
with a two-year lag in the weights.  Published series use a base year of 2000=100 where possible.  More 
detailed index series and additional information may be obtained at http://www.bls.gov/mxp, or by 
calling (202) 691-7101.

Merchandise Goods Classification Systems -- The merchandise price indexes are published using 
three classification systems.  Items are classified by end use according to the Bureau of Economic 
Analysis Classification System, by industry according to the North American Industry Classification 
System (NAICS), and by product category according to the Harmonized System (HS).  While 
classification by end use and product category are self-explanatory, some notes are in order for 
classifying items by industry.  In the NAICS imports and exports tables, items are classified by output 
industry, not input industry.  As an example, NAICS import index 326 (plastics and rubber products 
manufacturing) include outputs such as manufactured plastic rather than inputs such as petroleum.  The 
NAICS classification structure also matches the classification system used by the PPI (Producer Price 
Index) to produce the NAICS primary products indexes.

Import Price Indexes -- Products have been classified by the Harmonized Tariff Schedule of the United 
States Annotated (TSUSA).  Import prices are based on U.S. dollar prices paid by the U.S. importer.  
The prices are generally either "free on board" (f.o.b.) foreign port or "cost, insurance, and freight" 
(c.i.f.) U.S. port transaction prices, depending on the practices of the individual industry.  The index for 
crude petroleum is calculated from data collected by the U.S. Department of Energy.  

Export Price Indexes -- Products have been classified by the Harmonized Schedule B classification 
system of the U.S. Bureau of the Census.  The prices used are generally either "free alongside ship" 
(f.a.s.) factory or "free on board" (f.o.b.) transaction prices, depending on the practices of the individual 
industry.  Prices used in the grain index, excluding rice, are obtained from the U.S. Department of 
Agriculture.

Services Price Indexes -- The Import Air Passenger Fares Indexes are calculated from data obtained 
from a commercial airline reservation system.  These data exclude frequent flyer tickets and those sold 
by consolidators.  The Export Air Passenger Fares Indexes are calculated from data collected directly 
from airlines.  These data include frequent flyer tickets and those sold by consolidators.  Taxes and fees 
are excluded from both the Import and Export Air Passenger Fares Indexes.  The Air Freight Indexes are 
calculated from data collected directly from companies.  These data exclude mail and passenger 
baggage.  The scope of the service being priced is the movement of freight from airport to airport only, 
and does not include any ground transportation or port service.  The Air Freight Indexes are presented 
using two definitions: Balance of Payments (which represent transactions between U.S. and foreign 
residents) and International (which represent transactions inbound to and outbound from the U.S.).  Fact 
sheets specifying detailed information for each services industry are available at http://www.bls.gov/mxp 
under "Publications and Other Documentation."

Import Indexes by Locality of Origin -- Prices used in these indexes are a subset of the data collected 
for the Import Price Indexes.  Beginning with January 2002, the indexes are defined by locality of origin 
using a nomenclature based upon the North American Industry Classification System (NAICS).  
Nonmanufactured goods are defined as NAICS 11 and 21 and manufactured goods are defined as 
NAICS 31-33. 
 
Revision Policy -- To reflect the availability of late reports and corrections by respondents, monthly data 
may be revised in each of the three months after original publication.  After three months, no further data 
revisions take place.  So, for example, data released in the January release will be subject to revision in 
the releases for February, March, and April.

Uses of the Data -- The primary use of the indexes is to deflate trade statistics, notably the foreign trade 
sector of the National Income and Product Accounts constructed by the Department of Commerce.  
Other published indexes are useful for general market analysis.  For trade in international services, 
Balance of Payments indexes are used for deflating National Income and Product Accounts, while 
International indexes are more appropriate for market analysis.  Merchandise and services indexes also 
can be used to study U.S. competitiveness and to compute price elasticities, and the merchandise import 
indexes by country or region of origin are useful in terms of trade analysis.

E-Mail Subscription -- The IPP news release is available through an e-mail subscription service at 
(http://www.bls.gov/mxp) or (http://www.bls.gov/bls/newsrels.htm).
 
Additional Information -- More detailed IPP data are available on the IPP home page at 
(http://www.bls.gov/mxp).  Flat Files and the FTP server are available for users requiring access to 
either a large volume of time series data or other IPP-related documentation. The FTP site can be 
accessed at ftp://ftp.bls.gov.   For technical assistance in using the BLS Internet site, send e-mail to 
(labstat.helpdesk@bls.gov).  For IPP data requests, send e-mail to (mxpinfo@bls.gov). 

Information from this release will be made available to sensory impaired individuals upon request.  
Voice phone: 202-691-5200; Federal Relay Service: 1-800-877-8339.