Production Prices on the Rise

Although there is a buzz about there needing to be more products produced in the United States to stimulate the economy, this task is neither cheap nor easy at any step of the way.  The U.S. Bureau of Labor Statistics has announced that it has become a little bit more costly to create products in the U.S. at all of the various stages of production.

According to the BLS, in January, the Producer Price Index for finished goods increased 0.8 percent, seasonally adjusted.  At the earlier stages of processing, prices received by manufacturers of intermediate goods moved up 1.1 percent, and the crude goods index increased 3.3 percent.

In January, leading the broad-based increase in the index for finished goods were higher prices for finished energy goods, which rose 1.8 percent. The indexes for both finished goods less foods and energy and for finished consumer foods also contributed to this increase, moving up 0.5 percent and 0.3 percent, respectively.

Accounting for nearly two-thirds of the broad-based advance in the index for intermediate materials, supplies, and components, prices for intermediate goods other than foods and energy climbed 1.0 percent in January. The indexes for intermediate energy goods and for intermediate foods and feeds also contributed to this rise, moving up 1.8 percent and 0.4 percent, respectively.

In January, about half of the broad-based monthly advance in the index for crude materials for further processing is attributable to a 4.3-percent rise in prices for crude foodstuffs and feedstuffs. Also contributing to this increase, the index for crude nonfood materials less energy moved up 4.0 percent and prices for crude energy materials rose 1.9 percent.