Producer Price Index News Release summary

Transmission of material in this release is embargoed until USDL 19-1771
8:30 a.m. (EDT), Tuesday, October 8, 2019

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PRODUCER PRICE INDEXES - SEPTEMBER 2019

The Producer Price Index for final demand decreased 0.3 percent in September, seasonally
adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices rose 0.1
percent in August and 0.2 percent in July. (See table A.) On an unadjusted basis, the final
demand index advanced 1.4 percent for the 12 months ended in September.

In September, the index for final demand services decreased 0.2 percent, and prices for final
demand goods dropped 0.4 percent.

The index for final demand less foods, energy, and trade services was unchanged in September
after rising 0.4 percent in August. For the 12 months ended in September, prices for final
demand less foods, energy, and trade services advanced 1.7 percent.

Final Demand

Final demand services: The index for final demand services fell 0.2 percent in September following
a 0.3-percent increase in August. Leading the decline, the index for final demand trade services
decreased 1.0 percent. (Trade indexes measure changes in margins received by wholesalers and
retailers.) Prices for final demand transportation and warehousing services also moved down 1.0
percent. In contrast, the index for final demand services less trade, transportation, and warehousing
climbed 0.3 percent.

Product detail: Nearly half of the September decline in prices for final demand services can be traced
to the index for machinery and vehicle wholesaling, which fell 2.7 percent. The indexes for
automotive fuels and lubricants retailing; apparel, jewelry, footwear, and accessories retailing; airline
passenger services; gaming receipts (partial); and professional and commercial equipment
wholesaling also moved lower. Conversely, prices for hospital outpatient care rose 1.1 percent. The
indexes for bundled wired telecommunications access services and for food and alcohol wholesaling
also advanced. (See table 4.)

Final demand goods: The index for final demand goods decreased 0.4 percent in September after a
0.5-percent drop in August. Most of the September decline is attributable to prices for final demand
energy, which fell 2.5 percent. The index for final demand goods less foods and energy edged down
0.1 percent. In contrast, prices for final demand foods moved up 0.3 percent.

Product detail: Three-fourths of the September decrease in the index for final demand goods can be
traced to prices for gasoline, which fell 7.2 percent. The indexes for electric power, iron and steel
scrap, basic organic chemicals, fresh and dry vegetables, and light motor trucks also moved lower.
Conversely, prices for meats rose 1.9 percent. The indexes for liquefied petroleum gas and
pharmaceutical preparations also increased.

Table A. Monthly and 12-month percent changes in selected final demand price indexes, seasonally adjusted
Month	Total final demand	Final demand less foods, energy, and trade	Final demand goods				Final demand services				Change in final demand from 12 months ago (unadj.)	Change in final demand less foods, energy, and trade from 12 mo. ago (unadj.)
Month	Total final demand	Final demand less foods, energy, and trade	Total	Foods	Energy	Less foods and energy	Total	Trade	Transportation and warehousing	Other	Change in final demand from 12 months ago (unadj.)
2018
Sept.	0.1	0.3	-0.1	-0.1	-0.7	0.1	0.2	-0.3	1.3	0.3	2.7	3.1
Oct.	0.8	0.3	0.8	0.9	2.7	0.3	0.8	1.7	0.7	0.3	3.1	3.0
Nov.	-0.1	0.2	-0.5	1.0	-4.1	0.2	0.1	0.1	0.5	0.1	2.6	2.9
Dec.	-0.1	0.0	-0.6	2.1	-5.8	0.0	0.2	0.7	-0.2	0.0	2.6	2.8
2019
Jan.	-0.3	0.2	-0.6	-1.3	-3.3	0.3	-0.1	-0.4	-0.1	0.1	1.9	2.6
Feb.	0.2	0.1	0.3	-0.2	1.6	0.1	0.2	0.0	-0.8	0.3	1.9	2.4
Mar.	0.4	0.1	1.0	0.3	5.2	0.1	0.1	0.3	-0.4	0.1	2.0	2.2
Apr.	0.5	0.4	0.4	0.0	2.3	0.1	0.6	0.8	0.8	0.4	2.4	2.4
May(1)	0.2	0.3	-0.2	-0.3	-0.4	-0.1	0.3	0.0	0.7	0.4	2.1	2.4
June(1)	-0.2	-0.1	-0.5	0.4	-3.9	0.0	0.2	0.7	0.2	-0.2	1.7	2.1
July	0.2	-0.1	0.4	0.2	2.3	0.1	-0.1	0.2	0.2	-0.3	1.7	1.7
Aug.	0.1	0.4	-0.5	-0.6	-2.5	0.0	0.3	0.2	0.3	0.5	1.8	1.9
Sept.	-0.3	0.0	-0.4	0.3	-2.5	-0.1	-0.2	-1.0	-1.0	0.3	1.4	1.7
Footnotes (1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for May 2019 have been revised to reflect the availability of late reports and corrections by respondents.

Intermediate Demand by Commodity Type

Within intermediate demand in September, the index for processed goods decreased 0.4 percent,
prices for unprocessed goods fell 1.4 percent, and the index for services edged up 0.1 percent. (See
tables B and C.)

Processed goods for intermediate demand: The index for processed goods for intermediate
demand moved down 0.4 percent in September following a 0.7-percent decrease in August. Almost
three-quarters of the September decline can be attributed to prices for processed materials less foods
and energy, which fell 0.3 percent. The index for processed energy goods moved down 0.7 percent.
In contrast, prices for processed foods and feeds advanced 0.7 percent. For the 12 months ended in
September, the index for processed goods for intermediate demand decreased 3.4 percent, the largest
decline since dropping 3.7 percent for the 12 months ended July 2016.

Product detail: Over half of the September decline in the index for processed goods for intermediate
demand can be traced to prices for basic organic chemicals, which fell 3.8 percent. The indexes for
gasoline, commercial electric power, fabricated structural metal, agricultural chemicals and chemical
products, and residual fuels also moved lower. Conversely, prices for prepared animal feeds
advanced 0.9 percent. The indexes for diesel fuel and for hot rolled steel sheet and strip also
increased. (See table 5.)

Unprocessed goods for intermediate demand: Prices for unprocessed goods for intermediate
demand fell 1.4 percent in September following a 1.0-percent decline in August. Over half of the
broad-based decrease in September can be attributed to the index for unprocessed foodstuffs and
feedstuffs, which moved down 1.9 percent. Prices for unprocessed nonfood materials less energy fell
1.6 percent, and the index for unprocessed energy materials declined 0.8 percent. For the 12 months
ended in September, the index for unprocessed goods for intermediate demand dropped 10.1 percent.

Product detail: A major factor in the September decrease in prices for unprocessed goods for
intermediate demand was the index for slaughter cattle, which moved down 3.7 percent. Prices for
iron and steel scrap, slaughter barrows and gilts, crude petroleum, slaughter chickens, and raw milk
also fell. In contrast, the index for ungraded chicken eggs increased 55.2 percent. Prices for coal and
gold ores also advanced.

Table B. Monthly and 12-month percent changes in selected intermediate demand price indexes for goods by commodity type, seasonally adjusted
Month	Processed goods for intermediate demand					Unprocessed goods for intermediate demand
Month	Total	Foods and feeds	Energy goods	Less foods and energy	Total, change from 12 months ago (unadj.)	Total	Foodstuffs and feedstuffs	Energy materials	Nonfood materials less energy	Total, change from 12 months ago (unadj.)
2018
Sept.	0.2	-0.4	-0.1	0.4	6.0	0.9	0.8	2.0	-1.0	4.3
Oct.	0.7	0.5	3.0	0.1	6.1	3.3	4.3	3.7	0.8	7.6
Nov.	-0.6	0.2	-2.3	-0.3	4.5	-3.3	-0.3	-7.2	0.8	1.3
Dec.	-1.2	0.5	-4.5	-0.5	2.8	3.7	1.8	6.9	1.4	3.7
2019
Jan.	-0.9	0.5	-4.9	0.0	1.2	-4.6	0.3	-10.3	-1.8	-3.1
Feb.	0.1	0.0	1.1	-0.2	0.6	-2.5	-0.8	-5.6	-0.1	-6.7
Mar.	0.6	-0.2	3.9	-0.1	1.2	-0.4	-2.6	0.6	1.4	-3.8
Apr.	0.1	0.7	1.0	-0.1	0.9	1.7	4.4	1.1	-2.2	-3.3
May(1)	-0.4	-0.7	-1.1	-0.2	-0.7	-3.1	-2.2	-3.4	-3.7	-8.2
June(1)	-1.0	-0.4	-5.0	0.0	-2.1	-4.0	-1.6	-7.7	-1.2	-11.0
July	0.2	-0.1	2.2	-0.2	-2.0	1.6	-0.2	2.8	1.9	-10.4
Aug.	-0.7	0.3	-2.2	-0.4	-2.8	-1.0	-0.5	-2.2	0.1	-7.8
Sept.	-0.4	0.7	-0.7	-0.3	-3.4	-1.4	-1.9	-0.8	-1.6	-10.1
Footnotes (1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for May 2019 have been revised to reflect the availability of late reports and corrections by respondents.

Services for intermediate demand: Prices for services for intermediate demand inched up 0.1 
percent in September after rising 0.5 percent in August. The September advance is attributable to the 
index for trade services for intermediate demand, which increased 1.2 percent. Conversely, prices for 
services less trade, transportation, and warehousing for intermediate demand decreased 0.2 percent. 
The index for transportation and warehousing services for intermediate demand was unchanged. For 
the 12 months ended in September, prices for services for intermediate demand moved up 2.4 
percent.

Product detail: Nearly three-quarters of the September rise in prices for services for intermediate 
demand can be traced to margins for machinery and equipment parts and supplies wholesaling, which 
jumped 1.7 percent. The indexes for paper and plastics products wholesaling; bundled wired 
telecommunications access services; building materials, paint, and hardware wholesaling; and 
arrangement of freight and cargo transportation also advanced. In contrast, prices for gross rents of 
retail properties fell 4.4 percent. The indexes for business loans (partial), airline passenger services, 
and automotive fuels and lubricants retailing also declined.

Table C. Monthly and 12-month percent changes in selected intermediate demand price indexes for services by commodity type, seasonally adjusted
Month	Services for intermediate demand
Month	Total	Trade	Transportation and warehousing	Other	Total, change from 12 months ago (unadj.)
2018
Sept.	0.3	-0.4	0.6	0.3	3.3
Oct.	0.6	1.9	0.5	0.3	3.3
Nov.	0.1	0.0	0.2	0.1	3.1
Dec.	0.1	0.2	-0.1	0.2	3.1
2019
Jan.	0.2	0.4	0.2	0.1	2.8
Feb.	0.0	-0.3	0.0	0.1	2.6
Mar.	0.5	1.1	0.0	0.3	2.7
Apr.	0.4	1.2	0.5	0.3	3.1
May(1)	0.1	-0.6	0.4	0.1	2.8
June(1)	0.0	0.5	0.1	-0.1	2.6
July	-0.2	-0.8	0.3	-0.1	2.0
Aug.	0.5	0.6	0.5	0.5	2.5
Sept.	0.1	1.2	0.0	-0.2	2.4
Footnotes (1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for May 2019 have been revised to reflect the availability of late reports and corrections by respondents.

Intermediate Demand by Production Flow

Stage 4 intermediate demand: Prices for stage 4 intermediate demand were unchanged in
September following a 0.2-percent advance in August. In September, a 0.2-percent rise in the index
for total services inputs to stage 4 intermediate demand offset a 0.2-percent decrease in prices for
total goods inputs. (See table D.) Increases in the indexes for machinery and equipment parts and
supplies wholesaling; paper and plastics products wholesaling; diesel fuel; food and alcohol
wholesaling; and building materials, paint, and hardware wholesaling offset falling prices for
gasoline, gross rents of retail properties, business loans (partial), fabricated structural metal, and
basic organic chemicals. (See table 6.) For the 12 months ended in September, the index for stage 4
intermediate demand climbed 1.4 percent.

Stage 3 intermediate demand: The index for stage 3 intermediate demand declined 0.6 percent in
September, the fifth consecutive decrease. In September, prices for total goods inputs to stage 3
intermediate demand dropped 1.5 percent. Conversely, the index for total services inputs moved up
0.3 percent. Lower prices for gasoline, slaughter barrows and gilts, slaughter cattle, slaughter
chickens, raw milk, and gross rents of retail properties outweighed increases in the indexes for
machinery and equipment parts and supplies wholesaling, paper and plastics products wholesaling,
and ungraded chicken eggs. For the 12 months ended in September, the index for stage 3
intermediate demand fell 1.2 percent, the largest decrease since declining 1.8 percent for the 12
months ended October 2016.

Stage 2 intermediate demand: The index for stage 2 intermediate demand inched down 0.1 percent
in September after falling 0.3 percent in August. In September, prices for total goods inputs to stage
2 intermediate demand edged down 0.1 percent, while the index for total services inputs was
unchanged. Lower prices for crude petroleum, television advertising time sales, basic organic
chemicals, natural gas, and airline passenger services outweighed increases in the indexes for
liquefied petroleum gas, accounting services (partial), hot rolled steel sheet and strip, and
thermoplastic resins and materials. For the 12 months ended in September, prices for stage 2
intermediate demand declined 4.2 percent, the largest drop since decreasing 4.7 percent for the 12
months ended February 2016.

Stage 1 intermediate demand: The index for stage 1 intermediate demand fell 0.6 percent in
September after declining 0.3 percent in August. In September, prices for total goods inputs to stage
1 intermediate demand decreased 1.1 percent, while the index for total services inputs was
unchanged. Lower prices for basic organic chemicals, iron and steel scrap, gasoline, business loans
(partial), gross rents of retail properties, and airline passenger services outweighed advances in the
indexes for diesel fuel; paper and plastics products wholesaling; and building materials, paint, and
hardware wholesaling. For the 12 months ended in September, prices for stage 1 intermediate
demand moved down 3.7 percent, the largest decline since dropping 3.7 percent for the 12 months
ended May 2016.

Table D. Monthly percent changes in selected intermediate demand price indexes by production flow, seasonally adjusted
Month	Stage 4 intermediate demand			Stage 3 intermediate demand			Stage 2 intermediate demand			Stage 1 intermediate demand
Month	Total	Goods inputs	Services inputs	Total	Goods inputs	Services inputs	Total	Goods inputs	Services inputs	Total	Goods inputs	Services inputs
2018
Sept.	0.2	0.2	0.3	0.3	0.6	0.1	0.6	0.9	0.4	0.2	0.1	0.2
Oct.	0.6	0.5	0.7	1.4	2.3	0.6	0.6	1.3	0.1	1.1	1.4	0.7
Nov.	-0.2	-0.3	-0.1	-0.8	-1.6	0.2	-1.5	-3.4	0.1	-0.4	-0.8	0.1
Dec.	0.0	-0.4	0.3	-1.2	-2.6	0.3	0.8	1.9	-0.1	-1.0	-2.0	0.2
2019
Jan.	-0.2	-0.3	0.0	-0.3	-0.8	0.3	-1.9	-4.4	0.1	-1.3	-2.5	0.3
Feb.	0.2	0.2	0.0	0.1	0.2	0.0	-0.8	-2.3	0.2	-0.1	0.0	-0.3
Mar.	0.5	0.4	0.7	0.7	1.0	0.3	0.1	-0.3	0.4	0.9	1.3	0.3
Apr.	0.4	0.2	0.7	1.1	1.9	0.4	0.4	0.3	0.5	0.0	-0.5	0.7
May(1)	-0.2	-0.3	0.0	-0.3	-0.6	-0.1	-0.5	-1.8	0.5	-0.9	-1.7	0.0
June(1)	-0.2	-0.4	0.1	-1.1	-2.4	0.2	-1.5	-3.1	-0.5	-1.1	-2.1	0.1
July	0.1	0.4	-0.2	-0.2	0.0	-0.2	0.5	0.8	0.3	0.3	0.8	-0.4
Aug.	0.2	-0.4	0.7	-0.1	-0.8	0.5	-0.3	-1.3	0.3	-0.3	-1.4	0.7
Sept.	0.0	-0.2	0.2	-0.6	-1.5	0.3	-0.1	-0.1	0.0	-0.6	-1.1	0.0
Footnotes (1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for May 2019 have been revised to reflect the availability of late reports and corrections by respondents.

________________
The Producer Price Index for October 2019 is scheduled to be released on Thursday, November 14, 2019
at 8:30 a.m. (EST).

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