Transmission of material in this release is embargoed until                          USDL 19-0244 
8:30 a.m. (EST), Thursday, February 14, 2019

Technical information:      (202) 691-7705  *  ppi-info@bls.gov  *  www.bls.gov/ppi
Media contact:              (202) 691-5902  *  PressOffice@bls.gov                                 


                                PRODUCER PRICE INDEXES - JANUARY 2019


The Producer Price Index for final demand edged down 0.1 percent in January, seasonally 
adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices also fell 0.1 
percent in December and inched up 0.1 percent in November. (See table A.) On an unadjusted 
basis, the final demand index advanced 2.0 percent for the 12 months ended in January. 

In January, the decline in the final demand index can be traced to a 0.8-percent decrease in prices 
for final demand goods. In contrast, the index for final demand services increased 0.3 percent. 

The index for final demand less foods, energy, and trade services rose 0.2 percent in January 
following no change in December. For the 12 months ended in January, prices for final demand 
less foods, energy, and trade services moved up 2.5 percent.

Final Demand

Final demand goods: The index for final demand goods fell 0.8 percent in January, the largest 
decrease since dropping 1.2 percent in September 2015. Over three-quarters of the January decline 
can be traced to prices for final demand energy, which moved down 3.8 percent. The index for final 
demand foods fell 1.7 percent. Conversely, prices for final demand goods less foods and energy 
climbed 0.3 percent. 

Product detail: Forty percent of the decrease in the index for final demand goods is attributable to a 
7.3-percent decline in gasoline prices. The indexes for fresh and dry vegetables, diesel fuel, fresh 
fruits and melons, basic organic chemicals, and jet fuel also moved lower. In contrast, prices for 
construction machinery and equipment rose 1.7 percent. The indexes for processed poultry and 
residential electric power also increased. (See table 4.)

Final demand services: The index for final demand services advanced 0.3 percent in January 
following no change in December. Over 80 percent of the rise can be traced to margins for final 
demand trade services, which increased 0.8 percent. (Trade indexes measure changes in margins 
received by wholesalers and retailers.) Prices for final demand transportation and warehousing 
services climbed 0.5 percent. The index for final demand services less trade, transportation, and 
warehousing was unchanged.  

Product detail: Half of the advance in prices for final demand services is attributable to margins for 
apparel, jewelry, footwear, and accessories retailing, which rose 6.3 percent. The indexes for health, 
beauty, and optical goods retailing; machinery, equipment, parts, and supplies wholesaling; 
chemicals and allied products wholesaling; hospital inpatient care; and transportation of passengers 
(partial) also moved higher. Conversely, prices for portfolio management fell 5.2 percent. The 
indexes for automotive fuels and lubricants retailing and for physician care also decreased.

Intermediate Demand by Commodity Type

Within intermediate demand in January, prices for processed goods declined 1.4 percent, the index 
for unprocessed goods decreased 9.3 percent, and prices for services advanced 0.2 percent. (See 
tables B and C.)

Processed goods for intermediate demand: The index for processed goods for intermediate 
demand moved down 1.4 percent in January, the largest decline since falling 1.4 percent in 
September 2015. Over 80 percent of the January decrease can be traced to prices for processed 
energy goods, which declined 6.5 percent. The index for processed materials less foods and energy 
fell 0.3 percent. In contrast, prices for processed foods and feeds rose 0.5 percent. For the 12 months 
ended in January, the index for processed goods for intermediate demand increased 0.9 percent. 

Product detail: In January, over one-third of the decline in the index for processed goods for 
intermediate demand can be attributed to prices for diesel fuel, which dropped 13.7 percent. The 
indexes for utility natural gas, basic organic chemicals, gasoline, plastic resins and materials, and jet 
fuel also moved lower. Conversely, prices for processed poultry rose 6.9 percent. The indexes for 
semifinished steel mill products and asphalt also advanced. (See table 5.)

Unprocessed goods for intermediate demand: The index for unprocessed goods for intermediate 
demand moved down 9.3 percent in January, the largest decrease since a 9.6-percent drop in January 
2015. Leading the broad-based decline in January 2019, prices for unprocessed energy materials fell 
19.0 percent. The index for unprocessed nonfood materials less energy decreased 1.9 percent, and 
prices for unprocessed foodstuffs and feedstuffs moved down 0.5 percent. For the 12 months ended 
in January, the index for unprocessed goods for intermediate demand fell 3.1 percent, the largest drop 
since a 4.4-percent decline for the 12 months ended October 2016.

Product detail: Over three-quarters of the decrease in the index for unprocessed goods for 
intermediate demand can be traced to prices for natural gas, which fell 32.2 percent. The indexes for 
crude petroleum, fresh fruits and melons, iron and steel scrap, fresh vegetables (except potatoes), and 
ungraded chicken eggs also moved lower. In contrast, prices for slaughter poultry climbed 9.4 
percent. The indexes for coal and construction sand, gravel, and crushed stone also rose.

Services for intermediate demand: The index for services for intermediate demand moved up 0.2 
percent in January, the fifth consecutive increase. In January, nearly two-thirds of the broad-based 
advance can be attributed to margins for trade services for intermediate demand, which rose 0.7 
percent. Prices for services less trade, transportation, and warehousing for intermediate demand 
edged up 0.1 percent, and the index for transportation and warehousing services for intermediate 
demand climbed 0.2 percent. For the 12 months ended in January, the index for services for 
intermediate demand increased 2.9 percent.

Product detail: Half of the rise in the index for services for intermediate demand can be traced to 
margins for machinery and equipment parts and supplies wholesaling, which advanced 2.2 percent. 
The indexes for business loans (partial), services related to securities brokerage and dealing (partial), 
chemicals and allied products wholesaling, temporary help services, and legal services also moved 
higher. Conversely, prices for portfolio management fell 5.2 percent. The indexes for administrative 
and general management consulting services and for paper and plastics products wholesaling also 
declined.

Intermediate Demand by Production Flow

Stage 4 intermediate demand: The index for stage 4 intermediate demand moved down 0.2 percent 
in January after edging up 0.1 percent in December. In January, prices for total goods inputs to stage 
4 intermediate demand declined 0.4 percent. In contrast, the index for total services inputs moved up 
0.2 percent. (See table D.) Lower prices for diesel fuel, portfolio management, fresh fruits and 
melons, gasoline, administrative and general management consulting services, and basic organic 
chemicals outweighed increases in the indexes for machinery and equipment parts and supplies 
wholesaling, chemicals and allied products wholesaling, and biological products (including 
diagnostic substances). (See table 6.) For the 12 months ended in January, prices for stage 4 
intermediate demand moved up 2.4 percent.

Stage 3 intermediate demand: The index for stage 3 intermediate demand decreased 0.5 percent in 
January, the third straight decline. In January, prices for total goods inputs to stage 3 intermediate 
demand fell 1.4 percent. Conversely, the index for total services inputs moved up 0.3 percent. 
Decreases in prices for gasoline, diesel fuel, jet fuel, basic organic chemicals, ungraded chicken eggs, 
and portfolio management outweighed increases in the indexes for machinery and equipment parts 
and supplies wholesaling, slaughter poultry, and raw milk. For the 12 months ended in January, 
prices for stage 3 intermediate demand advanced 0.9 percent.

Stage 2 intermediate demand: Prices for stage 2 intermediate demand dropped 3.8 percent in 
January, the largest decline since falling 4.4 percent in January 2015. In January 2019, the index for 
total goods inputs to stage 2 intermediate demand decreased 8.6 percent. In contrast, prices for total 
services inputs edged up 0.1 percent. Declines in the indexes for natural gas, crude petroleum, 
portfolio management, plastic resins and materials, basic organic chemicals, and diesel fuel 
outweighed advances in the indexes for network compensation for cable and broadcast television; 
temporary help services; and semifinished steel mill products. For the 12 months ended in January, 
prices for stage 2 intermediate demand moved up 0.7 percent.

Stage 1 intermediate demand: The index for stage 1 intermediate demand fell 2.0 percent in 
January, the largest decline since decreasing 2.9 percent in January 2015. In January 2019, prices for 
total goods inputs to stage 1 intermediate demand moved down 3.7 percent. Conversely, the index for 
total services inputs advanced 0.2 percent. Lower prices for diesel fuel, basic organic chemicals, 
natural gas, iron and steel scrap, gasoline, and portfolio management outweighed increases in the 
indexes for chemicals and allied products wholesaling, business loans (partial), and soybean cake and 
meal. For the 12 months ended in January, prices for stage 1 intermediate demand advanced 0.4 
percent.

________________
The Producer Price Index for February 2019 is scheduled to be released on Wednesday, 
March 13, 2019 at 8:30 a.m. (EDT).
 
                                           *****

                          Recalculation of Seasonal Adjustment Factors

Effective with this release, seasonal adjustment factors have been recalculated to reflect price-movement 
patterns during 2018 for the Final Demand-Intermediate Demand (FD-ID) System and commodity-
grouping indexes. This routine annual recalculation may affect previously published seasonally adjusted 
indexes and percent changes for January 2014 through December 2018. 

Revised seasonally adjusted data for this period, as well as seasonal adjustment factors for directly 
adjusted commodity indexes to be used through December 2019, were released February 12, 2019. To 
obtain this information, contact the Division of Industrial Prices and Price Indexes, Section of Index 
Analysis and Public Information at ppi-info@bls.gov or (202) 691-7705, or visit the Producer Price Index 
homepage at https://www.bls.gov/ppi.

Tables E and F below provide monthly seasonally adjusted percent changes for major FD-ID system 
indexes in 2018, based on former and recalculated seasonal factors. These percent changes include final 
price data through August 2018 and may differ from values shown in tables A through D of this release, 
which include final price data through September 2018.

Table E.  Over-the-month percent changes in major final demand indexes, seasonally adjusted, using former 
and recalculated seasonal factors for 2018

               Final           Final demand       Final demand    Final demand less foods,
               demand             goods             services     energy, and trade services
Month      Former  Recalc.    Former  Recalc.    Former  Recalc.      Former   Recalc.
January      0.5     0.4        0.6     0.4        0.5     0.3          0.5      0.5
February      .2      .3         .1      .2         .2      .3           .3       .3
March         .2      .3         .3      .4         .3      .3           .3       .3
April         .2      .1         .0      .0         .2      .2           .2       .2
May           .5      .4         .9      .8         .3      .3           .3       .3
June          .3      .3         .2      .1         .3      .3           .2       .2
July          .1      .1         .0      .1         .2      .1           .3       .3
August        .0      .0         .2      .1        -.1      .0           .2       .2
September     .0      .0        -.3     -.3         .1      .1           .2       .2
October       .6      .6         .6      .7         .7      .7           .2       .2
November      .1      .1        -.4     -.5         .3      .3           .3       .3
December     -.2     -.1        -.4     -.3       - .1      .0           .0       .0


Table F.  Over-the-month percent changes in major intermediate demand indexes, seasonally adjusted, using 
former and recalculated seasonal factors for 2018

            Processed goods for       Unprocessed goods for          Services for
            intermediate demand        intermediate demand        intermediate demand
Month      Former   Recalculated      Former   Recalculated      Former   Recalculated
January      0.8         0.8            1.9         2.1            0.3         0.3
February      .6          .6            1.7         1.3             .3          .3
March        -.1          .1           -3.5        -3.4             .3          .3
April         .4          .5             .9         1.0             .3          .3
May          1.2         1.1            2.2         2.3             .3          .3
June          .6          .4           -1.0        -1.0             .2          .2
July          .0          .1             .6          .9             .4          .4
August        .2          .2           -3.7        -3.7             .0          .0
September    -.1          .0             .8         1.0             .3          .3
October       .8          .8            3.6         3.4             .4          .4
November     -.7         -.6           -5.3        -5.3             .2          .2
December     -.9         -.9           11.2        11.1             .1          .1