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6427.0 - Producer Price Indexes, Australia, Dec 2004  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 24/01/2005   
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DECEMBER QUARTER KEY FIGURES

Sep Qtr 04 to Dec Qtr 04
Dec Qtr 03 to Dec Qtr 04
STAGE OF PRODUCTION
% change
% change

Final (Stage 3) commodities (excl. exports)
1.1
4.3
Domestic
1.7
5.5
Imports
-1.8
-2.2
Intermediate (Stage 2) commodities
1.1
4.7
Domestic
1.4
4.8
Imports
-1.0
4.2
Preliminary (Stage 1) commodities
1.4
6.3
Domestic
1.6
5.8
Imports
0.3
9.6

Final Stage, Base: 1998-99 = 100.0
Graph: SOP Final Stage, Base: 1989-99  = 100.0.

Final Stage, Quarterly % change
Graph: SOP Final Stage, Quaterly % change



DECEMBER QUARTER KEY POINTS

FINAL (STAGE 3) COMMODITIES

  • The final (Stage 3) index rose 1.1% in the December quarter 2004.
  • The domestic component rose 1.7%, mainly due to increases in building construction, petroleum refining, meat and meat products, and motor vehicles and parts.
  • The imports component fell -1.8%, due to exchange rate driven price decreases for both consumer and capital goods, including electronic equipment, industrial machinery and other manufacturing, which were partially offset by increases in tobacco products.


INTERMEDIATE (STAGE 2) COMMODITIES
  • The intermediate (Stage 2) index rose 1.1% in the December quarter 2004.
  • The domestic component rose 1.4%, mainly due to increases in petroleum refining, basic chemical manufacturing, road freight transport, meat and meat products, and property operators and developers.
  • The imports component fell -1.0%, due to motor vehicles and parts, petroleum refining, electronic equipment, industrial machinery, electrical equipment, and textiles, clothing and footwear. These decreases were partially offset by increases in oil and gas extraction, and basic chemical manufacturing.


PRELIMINARY (STAGE 1) COMMODITIES
  • The preliminary (Stage 1) index rose 1.4% in the December quarter 2004.
  • The domestic component rose 1.6% mainly due to basic chemical manufacturing, petroleum refining, oil and gas extraction, road freight transport and property operators and developers. These increases were partially offset by falls in grain, sheep, beef and dairy farming, and coal mining.
  • The imports component rose 0.3%. Increases in oil and gas extraction, and in basic chemical manufacturing, were mostly offset by exchange rate driven price decreases for a range of items including petroleum refining, motor vehicles and parts, electronic equipment, industrial machinery, and paper and paper product manufacturing.


NOTES

CHANGES IN THIS ISSUE

There are no changes in this issue.


RELATED STATISTICS

For more information about statistics in this publication and about other 'ABS data available on request', contact Steve Whennan on Canberra (02) 6252 6251, or email <steve.whennan@abs.gov.au>.


INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or Steve Whennan on Canberra (02) 6252 6251.


COMMENTARY

STAGE OF PRODUCTION OVERVIEW

Each of the three stage of production indexes increased in the December quarter 2004, with the preliminary (Stage 1) index showing the largest rise of 1.4%, followed by an increase of 1.1% for both the intermediate (Stage 2) index and the final (Stage 3) index. Through the year to December quarter 2004, the preliminary (Stage 1) index increased by 6.3%, followed by an increase of 4.7% for the intermediate (Stage 2) index and an increase of 4.3% for the final (Stage 3) index.

The increase of 1.1% in the final (Stage 3) index reflects an increase of 1.7% in the price of domestically produced items and a fall of -1.8% in the price of imported items. The domestic component increased due to price rises for building construction, petroleum refining, meat and meat products, and motor vehicles and parts. The imports component decreased due to price falls for electronic equipment and industrial machinery, which were partially offset by price rises for tobacco products.

The increase of 1.1% in the intermediate (Stage 2) index reflects an increase of 1.4% in the price of domestically produced items and a fall of -1.0% in the price of imported items. The domestic component increased due to price rises for refined petroleum products, basic chemicals, road freight transport, meat and meat products, and property operators and developers. The import component decreased due to price falls for motor vehicles and parts, imported refined petroleum products, electronic equipment and industrial machinery, which were partially offset by price rises for oil and gas.

The increase of 1.4% in the preliminary (Stage 1) index reflects an increase of 1.6% in the price of domestically produced items and an increase of 0.3% in the price of imported items. The domestic component increased due to price rises for basic chemicals and petroleum products, oil and gas, road freight transport and property operators and developers. The import component increased due to price rises for oil and gas, which were partially offset by price falls for refined petroleum products, motor vehicles and parts, electronic equipment and industrial machinery

COMPARISON OF SOP INDEXES
Graph:Comparison of SOP indexes



MANUFACTURING INDUSTRIES PRODUCER PRICE INDEXES

During the December quarter 2004, the prices paid by manufacturers for their material inputs increased by 1.2%, while the prices they received for their outputs increased by 2.1%. These increases would have been more significant if not for the partially offsetting negative impact of the appreciation of the Australian dollar against all major currencies on the results for both the input and output indexes. The input price index increased by 9.7% through the year to December quarter 2004 and the output price index increased by 8.2% during the same period.

Increases in the price of crude oil (both domestic and imported), cattle and calves, and pigs were the main contributors to the quarterly result for the materials used in manufacturing industries index. Price decreases for sheep and lambs, iron ore mining and whole milk products provided some offsets to these increases.

Higher prices for kerosene, diesel, leaded and unleaded petroleum, and beef contributed to the bulk of the increase in the articles produced by manufacturing industries index for the December quarter 2004. These increases were partially offset by decreases in prices for lamb and mutton, and alumina.

ARTICLES PRODUCED BY MANUFACTURING INDUSTRIES: All Groups, Quarterly % change
Graph: Articles Produced By Manufacturing Industries, All Groups, Quarterly % change


Materials used in manufacturing industries: All Groups, Quarterly % change
Graph: Materials used in manufacturing industries, All Groups Quarterly % change



CONSTRUCTION INDUSTRIES PRODUCER PRICE INDEXES

The price indexes for materials used in house building increased by 0.8% in the December quarter 2004, reflecting price increases for a range of materials. The most significant contributors to the increase were metal roofing and guttering, plastic pipes and fittings, terracotta tiles and concrete tiles. Small offsetting price decreases were recorded for switches and distribution boards, and carpet and other floor coverings. Increases were recorded in all state capitals, ranging from 0.5% in Melbourne to 1.3% in Hobart.

Through the year to December quarter 2004, the materials used in house building index rose 3.5%

Materials Used in House Building: All Groups, Quarterly % change
Graph: Materials Used in House, All Groups, Quarterly % change



The price index for the output of the general construction industry increased by 2.1% in the December quarter 2004 and by 8.3% through the year to December quarter 2004. Increases were registered in the quarter for all component industries, with the index for non-residential building construction being the largest contributor, followed by house construction, residential building construction other than houses, and road and bridge construction.

Contributing to the movement in the general construction industry price indexes this quarter were increases in the cost of labour and material inputs. The increase in labour costs was mainly due to continuing high demand for building trades and shortages of skilled labour. An increase in the cost of steel products had a considerable impact on material inputs.

Output of the general construction industry: All Groups, Quarterly % change
Graph: Output of the General Construction Industry, All Groups, Quarterly % change




SERVICE INDUSTRIES PRODUCER PRICE INDEXES

The property and business services industries price index increased by 0.6% in the December quarter 2004 and by 2.9% through the year to December quarter 2004. The property services price index increased by 0.8% this quarter with increases for retail property operators, office property operators and industrial property operators. These increases were partially offset by a decrease in Australian residential sales fees. Through the year to December quarter 2004, the property services index rose 3.6%.

Property and Business services industries: All Groups, Quarterly % change
Graph: Property and Business services industries, All Groups, Quarterly % change



The business services index rose 0.4% in the December quarter 2004 and by 2.5% through the year to December quarter 2004. The main contributors to the increase were computer consultancy and accounting services. These increases were partially offset by decreases in business management consultancy and legal services.

The transport (freight) and storage industries index increased by 1.7% in the December quarter 2004 and by 4.6% through the year to December quarter 2004. The most significant contributors with price increases were bulk freight, general road freight and express road freight. The most significant contributors with price decreases were coastal transport bulk shipping, and international air freight.

Transport (freight) and Storage industries: All Groups, Quarterly % change
Graph: Transport (freight) and Storage industris, All Groups, Quarterly % change


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