Industrial Product Price Index: Flash estimates, July 2021
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Released: 2021-08-13
The Industrial Product Price Index (IPPI) edged up 0.1% month-over-month in July. Year-over-year, the index rose 16.2%.
The growth in the IPPI was led primarily by higher prices for energy and petroleum products (+5.1%) and chemicals and chemical products (+6.3%). These gains were largely moderated by lower prices for lumber and other wood products (-23.0%).
Prices for lumber and other wood products (-23.0%) continued to fall in July after posting a 6.6% decline in June, which largely offset the increase in the IPPI. Lower prices for softwood lumber (-37.7%) were the main contributing factors to the decrease in this group. The large decrease is partially attributable to increased supply at sawmills. If lumber and other wood products were excluded from calculation, the IPPI would have risen 2.1%.
Prices for energy and petroleum products have been increasing since October 2020. In July, higher prices for this group were driven mostly by gains in refined petroleum energy products (including liquid biofuels) (+5.2%). These increases are partially due to rising prices for crude oil, as well as higher refinery margins. The IPPI excluding energy and petroleum products was down 0.3%.
The increase in chemicals and chemical products was mostly due to higher prices for petrochemicals (+29.6%) and plastic resins (+7.7%). Year over year, prices for petrochemicals were 118.7% higher when compared with July 2020. Prices for plastic resins have been growing for eight consecutive months since December 2020 as a result of limited supply and high demand.
Prices for primary ferrous metal products (+5.6%), which have been increasing since September 2020, also supported the monthly gain in the IPPI. The increase was mainly due to higher prices for basic and semi-finished iron or steel products (+5.7%).
Motorized and recreational vehicles (+1.2%) posted a monthly increase in July, led mainly by motor vehicle engines and motor vehicle parts (+1.8%), and passenger cars and light trucks (+1.2%). Higher prices for this group are influenced by the appreciation of the US dollar against the Canadian dollar, as well as rising costs for raw materials used in the industry, such as steel.
Chart 1
Industrial Product Price Index (January 2018 to July 2021)
Chart 2
Softwood lumber (January 2018 to July 2021)
Note to readers
Statistics Canada is releasing early estimates of the Industrial Product Price Index (IPPI) for July 2021 to provide Canadians with timely economic data. These are referred to as flash estimates and are subject to revision when the index is officially released on August 27, 2021. As the flash estimates are calculated using preliminary data, these values should be used with caution.
Products
The product "Industrial Product Price Index: Annual review, 2020" is now available as part of the Prices Analytical Series (62F0014M).
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