In December, the increase in the index for finished goods was driven by higher prices for consumer foods, which moved up 1.4 percent. By contrast, prices for energy goods declined 0.4 percent. The index for finished goods less foods and energy was unchanged.
Finished foods: The index for finished consumer foods rose 1.4 percent in December, its third consecutive monthly increase. Accounting for one-fifth of the December advance, the index for pork climbed 9.4 percent. Higher prices for processed poultry and fresh vegetables (except potatoes) also had a significant impact on the finished consumer foods index.
Finished energy: Prices for finished energy goods decreased 0.4 percent in December after increasing in each of the prior two months. Leading this decline, the gasoline index fell 3.2 percent. Lower prices for residential natural gas also were a factor in the December finished energy goods decrease.
Intermediate goods
The Producer Price Index for Intermediate Materials, Supplies, and Components moved up 0.5 percent in December, its fifth straight monthly increase. Accounting for about three-quarters of the broad-based December advance, prices for intermediate goods less foods and energy rose 0.5 percent. Additionally, the indexes for intermediate foods and feeds and for intermediate energy goods increased 1.6 percent and 0.2 percent, respectively. In 2009, prices for intermediate goods climbed 3.0 percent, after falling 2.3 percent in 2008.
Intermediate core: The index for intermediate materials less foods and energy advanced 0.5 percent in December, its second consecutive monthly increase. Prices for primary basic organic chemicals accounted for about a quarter of the December rise, moving up 3.1 percent. The indexes for plastic resins and materials and for nonferrous wire and cable also contributed to higher intermediate core prices.
Intermediate foods: The index for intermediate foods and feeds rose 1.6 percent in December, its second straight monthly advance. A major contributor to the December increase was a 4.3-percent climb in prices for natural, processed, and imitation cheese. The index for pork also was a factor in rising prices for intermediate foods.
Intermediate energy: The intermediate energy goods index increased 0.2 percent in December, its third consecutive monthly advance. Contributing significantly to the December rise, prices for liquefied petroleum gas moved up 7.1 percent.
Crude goods
The Producer Price Index for Crude Materials for Further Processing increased 1.0 percent in December. For the 3-month period ending in December, crude material prices rose 12.6 percent after declining 2.4 percent in the 3 months ending in September. In December, monthly increases of 3.8 percent in the index for crude foodstuffs and feedstuffs and 5.0 percent for prices of crude nonfood materials less energy outweighed a 2.8-percent decrease in the index for crude energy materials.
Crude foods: Prices for crude foodstuffs and feedstuffs rose 3.8 percent in December. This index jumped 12.1 percent in the most recent 3-month period compared with an 8.5-pecent decline in the previous 3-month period. Accounting for about forty percent of the monthly December increase, the fluid milk index moved up 10.8 percent. Higher prices for slaughter barrows and gilts and for soybeans also contributed to the advance in the crude foodstuffs and feedstuffs index.
Crude core: The index for crude nonfood materials less energy moved up 5.0 percent in December, and 4.8 percent for the 3 months ending in December. For the 3 months ending in September, crude core prices climbed 12.3 percent. In December, over half of the monthly increase can be attributed to a 12.7-percent jump in prices for iron and steel scrap. An advance in the nonferrous metal ores index also was a significant factor in the rise in prices for crude nonfood materials less energy.
Services Analysis
Trade industries: The Producer Price Index for the Net Output of Total Trade Industries declined 0.6 percent in December after rising 1.3 percent in November. (Trade indexes measure changes in margins received by wholesalers and retailers.) Accounting for about forty percent of the December decrease, margins received by clothing and clothing accessories stores fell 5.5 percent. Lower margins received by warehouse clubs and supercenters, as well as by merchant wholesalers of nondurable goods, also contributed to the decline in the total trade industries index. In December 2009, the total trade industries index was unchanged from its year-ago level.
Transportation and warehousing industries: The Producer Price Index for the Net Output of Total Transportation and Warehousing Industries climbed 0.5 percent in December, its third consecutive monthly increase. About eighty-five percent of the advance can be traced to a 2.1-percent rise in prices received by the air transportation industry group. The indexes for courier services and transportation support activities also moved up in December. In 2009, the total transportation and warehousing industries index edged down 0.3 percent.
Traditional service industries: The Producer Price Index for the Net Output of Total Traditional Service Industries advanced 0.2 percent in December after inching down 0.1 percent in November. Most of the December rise can be traced to a 1.4-percent jump in prices received by general medical and surgical hospitals. The industry indexes for portfolio managers and nursing care facilities also moved up in December. In 2009, the total traditional service industries index increased 1.2 percent.
