The Canadian Industrial Product Price Index (IPPI) was up 0.5 percent in September compared with August, largely the result of higher prices for primary metal products and petroleum and coal products, according to Statistics Canada. The Raw Materials Price Index (RMPI) rose 1.3 percent in September, mainly because of higher prices for non-ferrous metals.

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After posting declines for four months, the IPPI increased 0.5 percent in September, its largest gain since September 2011.

The main contributor to the IPPI increase in September was primary metal products (+5.1 percent), mainly a result of higher prices for other non-ferrous metal products (+10.4 percent), copper and copper alloy products (+9.5 percent) and aluminum products (+5.3 percent). The rise in metals was partly a result of higher demand.

Petroleum and coal products (+2.7 percent) also made an important contribution to the IPPI increase in September. Higher prices for fuel oils and other fuels as well as gasoline were the main reasons for this increase. The IPPI excluding petroleum and coal products rose 0.2 percent in September.

The IPPI advance was moderated primarily by motor vehicles and other transportation equipment (-0.8 percent). The increase in the value of the Canadian dollar against the US dollar in September was largely responsible for this decline.

Most Canadian producers who export their products are paid in US dollars. Consequently, the 1.4 percent increase in the value of the Canadian dollar relative to the US dollar in September had the effect of reducing the corresponding prices in Canadian dollars.

Chemical products, lumber and other wood products as well as pulp and paper products further moderated the increase of the IPPI.

12-Month Change
Compared with September 2011, the IPPI was down 0.3 percent, the second consecutive year-over-year decrease.

The IPPI was mainly driven down by primary metal products (-6.5 percent), particularly by lower prices for other non-ferrous metal products (-9.2 percent), aluminum products (-10.7 percent) and nickel products (-18.2 percent).

Chemical products (-3.6 percent), motor vehicles and other transportation equipment (-1.2 percent) and pulp and paper products (-2.1 percent) also contributed to the year-over-year decline of the IPPI.

The 2.5 percent year-over-year increase in the value of the Canadian dollar against the US dollar was mainly responsible for lower prices of motor vehicles and other transportation equipment.

Compared with September 2011, the IPPI decline was moderated by petroleum and coal products (+2.7 percent), mainly as a result of higher prices for gasoline (+5.1 percent). Among the other commodity groups that posted gains were lumber and other wood products and fruit, vegetable, feeds and other food products.

The IPPI excluding petroleum and coal products was down 0.7 percent, year over year.

Raw Materials Price Index
The RMPI rose 1.3 percent in September, the third consecutive monthly increase.

The advance of the RMPI was largely attributable to non-ferrous metals (+8.8 percent), specifically copper concentrates (+14.2 percent), non-ferrous metal scrap (+8.5 percent) and precious metals (+8.4 percent).

After declining for six months, non-ferrous metals posted its largest gain since April 2009.

Compared with previous months, mineral fuels (+0.9 percent) made a modest contribution to the increase of the RMPI in September. Higher prices for crude oil were entirely responsible for the increase, which was nevertheless moderate as supply was sufficient to satisfy demand.

The advance of the RMPI in September was slightly moderated by lower prices for animals and animal products, vegetable products and wood products.

The RMPI excluding mineral fuels rose 1.7 percent in September.

Compared with September 2011, the RMPI was down 3.9 percent, the seventh consecutive year-over-year decrease.

The decline of the RMPI was mostly the result of mineral fuels (-5.5 percent), specifically crude oil. Compared with September 2011, the RMPI excluding mineral fuels decreased 2.5 percent.

Non-ferrous metals (-6.2 percent) also contributed significantly to the year-over-year decline of the RMPI, as prices were down for copper and nickel concentrates, other non-ferrous base metals and radioactive concentrates.

Compared with September 2011, the decline of the RMPI was slightly moderated by wood products (+6.7 percent), largely as a result of higher prices for logs and bolts.