lower prices for non-ferrous metals (-4.5%) and animals and animal products (-2.1%).

Prices for intermediate goods: First month-over-month rise after six consecutive declines
From October to November, prices for intermediate goods rose 0.6% after six consecutive month-over-month declines. Intermediate goods were pushed up by the prices for petroleum and coal products and, to a lesser extent, the prices for chemical products and fruit, vegetables and feed products. The greatest downward contribution came from prices for primary metal products, electrical and communication products, lumber and other wood products, and pulp and paper products.

From November 2006 to November 2007, prices for intermediate goods remained unchanged, following a 0.5% drop in October. Intermediate goods prices that were up included those for petroleum and coal products, fruit, vegetables and feed products and chemical products. By contrast, prices were lower for primary metal products, pulp and paper products, motor vehicles, and lumber and other wood products.

Prices for finished products: A turnaround led by petroleum and coal products
From October to November, prices for finished products rose 0.5%, the first increase after seven consecutive monthly declines. Most of the increase came from the jump in prices for petroleum and coal products. Among other finished products, only the decline in prices for motor vehicles made a significant contribution.

Since November 2006, prices for finished goods have fallen 1.7%, a fifth consecutive decline. Prices for finished products were mainly pulled down by lower prices for motor vehicles, machinery and equipment, and electrical and communication products. However, the reduction in prices for finished products was slowed by an increase in prices for petroleum and coal products, tobacco products and food products.Source: Statistics Canada

In November, prices in Canada for manufactured products and raw materials were pushed up by surging petroleum prices.

From October to November, prices charged by manufacturers, as measured by the Industrial Product Price Index (IPPI), rose 0.6%, a marginal increase after six consecutive monthly declines. The rise in the index was caused almost exclusively by surging prices for petroleum and coal products.

On a 12-month basis, the IPPI declined 0.6%, continuing the downward trend. Declines in the prices for motor vehicles and other transport equipment, primary metal products and pulp and paper products were tempered by the steep increase in the prices for petroleum and coal products.

The exchange rate, reflecting the ongoing effect of a strong Canadian dollar in relation to its US counterpart, had less of an impact on price declines than it had in the previous month. If the exchange rate that is used to convert these prices had remained unchanged from the previous month, the IPPI would have risen 0.9% compared to October instead of 0.6%, and on a 12-month basis, the IPPI would have risen 3.6% rather than falling 0.6%.
 
The Raw Materials Price Index (RMPI) jumped 3.4% from October to November, a stronger increase than the 0.7% recorded the previous month. In November, the RMPI was pushed up solely by the rise in crude oil prices, while prices for the other product groups continued their downward trend.

Compared to November 2006, raw materials cost plants 15.7% more. The increase in the index was supported primarily by higher prices for mineral fuels and vegetable products.

In November, the IPPI was 113.0 (1997=100), up from October’s revised level of 112.3. The RMPI was 181.9 (1997=100), up from October’s revised level of 175.9.

IPPI: Slight price increase after six consecutive monthly declines
Month over month, manufacturers’ prices were pushed up mainly by the surging prices for petroleum and coal products, while prices for non-energy products generally continued their downward trend. Among the products showing declines, primary metal products and motor vehicles and other transport equipment contributed the most to moderate the effect of rising petroleum and coal products.

In November, prices for petroleum and coal products jumped 7.2%, reaching a new historical peak. Excluding the prices for petroleum and coal, the IPPI would have decreased 0.2% rather than rising 0.6%, and it would have registered an eighth consecutive monthly decline. Apart from the surging prices for petroleum and coal products, few products posted a significant increase; among them were chemical products and fruit, vegetables and feed products.

Prices for primary metal products declined 1.8% compared with October, mainly owing to a drop in primary copper products (-16.3%). Copper products were hit by the slowdown in economic activity in the United States and excess global supply in relation to demand. Refined zinc products, also affected by excess supply, fell 16.4%. Prices for motor vehicles and other transport equipment declined 0.5%, mainly owing to the effect of the appreciation of the Canadian dollar against its US counterpart.

IPPI: 12-month change shows downward price trend continuing
The IPPI fell 0.6% from November 2006 to November 2007, after posting a 1.1% decline in October and declines in July (-0.3%) and August (-0.6%). The 14.9% drop in the value of the US dollar in the past 12 months was a factor that influenced the movement of prices in the IPPI. Lower prices for motor vehicles, primary metal products and pulp and paper products more than offset the effect of increased prices for petroleum and coal products.

Motor vehicle prices fell 9.0% their eighth consecutive year-over-year decline. Prices for primary metals fell 8.6%, slightly exceeding the 8.1% drop observed in October. The index is returning to the levels of March and April 2006, when the period of strong price growth began. Declines were steepest for refined zinc products (-47.3); primary aluminum (-18.3%), copper (-14.7%) and steel (-4.8%) products; and nickel products (-9.5%). Prices for pulp and paper products fell 7.2%, led by the decline in the price for newsprint and other paper for printing (-18.6%); consumption of this type of paper continues to contract.

The drop in the IPPI was moderated mainly by prices for petroleum and coal products, which jumped 26.3%, a third consecutive increase. If petroleum and coal had been excluded, the IPPI would have fallen 3.2% instead of 0.6%. Other price increases included those for fruit, vegetables and feed products, which rose 4.5%.

RMPI: Mineral fuels boost prices for raw materials
The rise in prices for raw materials accelerated with a 3.4% increase in November, following a 0.7% rise in October. The RMPI rose solely on the strength of crude oil prices, which surged in November in their third consecutive monthly increase. All other product groups saw declines, but non-ferrous metals in particular tempered the rise in the RMPI.

Prices for mineral fuels rose a hefty 9.7%, owing to the 10.7% jump for crude oil and, to a lesser extent, a 2.6% rise for natural gas. With a 10.7% rise in November, crude oil prices posted their second biggest increase for 2007; the biggest was observed in July, with a jump of 11.9%. The price per barrel of crude oil peaked in the third week of November at almost US $100, propelled in part by excess demand in relation to the supply of crude oil. Natural gas rose 2.6% in November, owing to the early arrival of winter in some parts of the continent and despite the relatively high level of inventories. However, the natural gas price index is relatively low, and in November, it was 13.0% below the annual average for 2006. Mineral fuels were the only product group to boost prices for raw materials. If mineral fuels had been excluded, the RMPI would have declined 2.8% compared to October instead of rising 3.4%.

Non-ferrous metal prices fell 5.4% in November, continuing the downward trend. The index has declined 18.5% from its historical peak in May 2007. Non-ferrous metal prices continue to react to the economic slowdown in the US housing sector and more generally to the reduction in global demand for metals. In particular, the largest declines were for concentrates of zinc (-16.6%), copper (-16.5%) and lead (-8.7%). By contrast, prices for radioactive concentrates jumped 7.1% in conjunction with the pressure exerted on energy products.

Among other decreases in raw materials prices, animals and animal products declined 1.3%. This was mainly due to lower prices for slaughter hogs (-11.6%), the index for which reached a new historical low. Price declines were also observed for logs and bolts (-1.7%), in connection with the fact that the industry was facing increasingly strong competitive conditions, aggravated by a drop in seasonal demand.

On a 12-month basis, prices for raw materials rose 15.7% in November, up from the 13.0% increase observed in October. Raw materials prices were mainly pushed up by higher prices for mineral fuels and, to a lesser extent, vegetable products. Mineral fuels jumped 33.4% on the strength of a year-over-year increase of 41.7% in the price for crude oil. Without mineral fuels, the RMPI would have risen 0.7% instead of 15.7%.

Prices for vegetable products rose 20.6%, led by grains and oilseeds. On the other hand, the growth of the RMPI was slowed by