The following is the text of the
industrial product and raw material prices report as reported
by Statistics Canada.
The Industrial Product Price Index (IPPI) edged up 0.2% in
March, led by higher prices for petroleum and coal products.
However, the advance of IPPI was moderated by primary metal
products (-1.0%). The Raw Materials Price Index (RMPI) declined
1.6%, largely because of mineral fuels.
Industrial Product Price Index, monthly change
The IPPI was up 0.2% in March compared with February.
Despite a third consecutive gain, the IPPI remained below its
recent 2011 peak. The number of product groups that have risen
since the beginning of the year declined from 10 in January to 6
The increase in the IPPI in March was primarily the result
of higher prices for petroleum and coal products (+1.8%),
particularly gasoline (+4.7%), which was up for a third straight
Fruit, vegetables and feeds (+0.8%) and lumber and other
wood products (+0.7%) also contributed to the increase of the
Prices for fruit, vegetables and feeds were pushed upward
mainly by feeds (+2.2%).
Softwood lumber (+1.3%) was the leading factor in the
increase in lumber and other wood product prices. The strength
of building permits in the United States played a role in
sustaining prices, although the demand for wood was modest.
The advance in the IPPI was moderated mainly by primary
metal products (-1.0%), particularly nickel products (-8.8%),
aluminum products (-1.2%), silver and platinum (-4.0%) and gold
and gold alloys in primary forms (-4.4%). The decline in nickel
and aluminum prices was partly a result of weaker economic
activity in Asia, a large importer of metals.
Prices for motor vehicles and other transportation
equipment edged down 0.1%.
Some Canadian producers who export their products are
generally paid on the basis of prices set in US dollars.
Consequently, the 0.3% increase in the value the Canadian dollar
relative to the US dollar in March had the effect of reducing
the corresponding prices in Canadian dollars. However, the
exchange rate had a negligible impact on the index as a whole.
The IPPI excluding petroleum and coal products declined
0.1% in March.
12-month change in the Industrial Product Price Index
Compared with the same month a year earlier, the IPPI rose
0.9% in March. The index continued to rise on a 12-month basis,
though its growth has been slowing since September 2011.
Relative to March 2011, the index was pushed upward mainly
by higher prices for petroleum and coal products (+4.2%),
notably gasoline (+7.9%).
More modest contributions to the year-over-year increase in
the index were made by motor vehicles and other transportation
equipment (+1.6%) and fruit, vegetables and feeds (+2.6%).
On a 12-month basis, the advance of the IPPI was moderated
primarily by a decrease in primary metal products (-5.7%), which
posted its fifth consecutive decline. The biggest contributors
to the decrease in this group of products were nickel (-28.9%),
aluminum (-7.6%) and copper and copper alloys (-5.6%).
The 1.7% decline in the value of the Canadian dollar
against the US dollar contributed to the growth of the index.
Without the impact of the exchange rate, the IPPI would have
risen 0.5% instead of 0.9%.
Compared with March 2011, the IPPI excluding petroleum and
coal products increased 0.4%, a slightly slower pace than in
Raw Materials Price Index, monthly change
The RMPI was down 1.6% in March, its second consecutive
monthly decrease. The decline was mostly the result of mineral
fuels (-3.6%), particularly crude petroleum (-3.8%), which
decreased for a fourth straight month.
The decline of the RMPI was moderated primarily by
vegetable products (+1.6%), especially oilseeds (+5.7%) and
Within the oilseeds product group, prices rose for canola
(+7.8%) and soybeans (+5.8%). The increase in soybean prices was
partly the result of a decline in global supply, especially in
South America, where dry weather conditions disrupted normal
The main contributors to the increase in grain prices were
corn (+2.0%), barley (+2.8%) and wheat (+1.0%).
The RMPI excluding mineral fuels posted a 0.3% increase in
March, its third consecutive monthly advance.
12-month change in the Raw Materials Price Index
Compared with the same month a year earlier, the RMPI was
down 5.6%, its first decrease since October 2009.
The index was pushed downward largely by lower prices for
mineral fuels (-8.3%) and, to a lesser extent, by non-ferrous
Crude petroleum (-8.4%) was primarily responsible for the
decline in mineral fuels, posting its first decrease since
Except for precious metals, all commodities in the non-
ferrous metals group were down on a 12-month basis. Among the
main contributors to the decline were radioactive concentrates
(-23.9%), non-ferrous scrap metals (-10.9%) and other non-
ferrous base metals (-14.4%).
Year over year, the RMPI excluding mineral fuels fell 3.2%
in March, its fourth consecutive decline.
Note to readers
All data in this release are seasonally unadjusted and
usually subject to revision for a period of six months (for
example, when the July index is released, the index for the
previous January becomes final).
The Industrial Product Price Index (IPPI) reflects the
prices that producers in Canada receive as the goods leave the
plant gate. It does not reflect what the consumer pays. Unlike
the Consumer Price Index, the IPPI excludes indirect taxes and
all the costs that occur between the time a good leaves the
plant and the time the final user takes possession of it,
including transportation, wholesale and retail costs.
Canadian producers export many goods. They often indicate
their prices in foreign currencies, especially in US dollars,
which are then converted into Canadian dollars. In particular,
this is the case for motor vehicles, pulp, paper and wood
products. Therefore, a rise or fall in the value of the Canadian
dollar against its US counterpart affects the IPPI. But the
conversion into Canadian dollars only reflects how respondents
provide their prices. Moreover, this is not a measure that takes
into account the full effect of exchange rates, since that is a
more difficult analytical task.
The conversion of prices received in US dollars is based on
the average monthly exchange rate (noon spot rate) established
by the Bank of Canada and is available on CANSIM in table 176-
0064 (series v37426). Monthly and annual variations in the
exchange rate, as described in the text, are calculated
according to the indirect quotation of the exchange rate (for
example, CAN$1 = US$X).
The Raw Materials Price Index (RMPI) reflects the prices
paid by Canadian manufacturers for key raw materials. Many of
those prices are set on the world market. However, as few prices
are denominated in foreign currencies, their conversion into
Canadian dollars has only a minor effect on the calculation of
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