ADDITIONAL COMMENTARY


MANUFACTURING INDUSTRIES PRODUCER PRICE INDEXES

In the December quarter 2011, the prices paid by manufacturers for material inputs fell 1.0%, while the prices received for outputs fell 0.3%. Through the year to the December quarter 2011, prices of material inputs rose 7.3%, while the prices received for outputs rose 2.8%.

Falls in the prices paid for products from metal ore mining (–3.8%), primary metal and metal products (–4.4%) and agriculture (–2.9%) drove the decrease in the cost of materials used in the manufacturing industries. Major contributors to these price falls were silver and zinc ores, copper recovery, aluminium (excluding scrap), untreated milk, wool and sugar cane. Partly offsetting these falls were rises in the prices paid for oil and gas extraction (+2.7%) and transport equipment (+1.8%).

Falls in the prices received for basic non–ferrous metal manufacturing (–8.5%) and basic non–ferrous metal product manufacturing (–7.5%) drove the decrease in the prices received for produced articles primary to the manufacturing industries. Major contributors to these price falls were precious metal recovery and copper extruded products. Partly offsetting these falls were rises in the prices received for petroleum and coal product manufacturing (+2.6%), sugar and confectionery manufacturing (+6.0%) and motor vehicle and motor vehicle part manufacturing (+1.7%).

CONSTRUCTION INDUSTRIES PRODUCER PRICE INDEXES

MATERIALS USED IN HOUSE BUILDING

The price index of materials used in house building rose 0.1% in the December quarter 2011. This follows a rise of 0.2% in the September quarter 2011. The most significant contributors this quarter were rises in prices paid for other metal products (+0.6%), other materials (+0.6%), electrical equipment (+2.8%) and ceramic products (+0.5%). Partly offsetting these rises were falls in the prices paid for timber, board and joinery (–1.1%).

All capital cities except for Melbourne (–0.5%) rose in the December quarter 2011, with price increases ranging from Hobart and Perth (+0.2%) to Sydney and Adelaide (+0.5%).

Through the year to the December quarter 2011, the materials used in house building price index rose 1.5%. This rise was mainly attributed to increases in the prices paid for concrete, cement and sand (+8.4%), other materials (+2.5%) and ceramic products (+3.0%).

DIVISION E, SUBDIVISION 30 – BUILDING CONSTRUCTION AND CLASS 3101 ROAD AND BRIDGE CONSTRUCTION

Division E, Subdivision 30 – Building construction rose 0.1% and Class 3101 – Road and bridge construction rose 1.2% for the December quarter 2011.

Subdivision 30 – Building construction was driven by rises in the prices received for Class 3019 – Other residential building construction (+0.1%) which was mainly influenced by Queensland (+0.7%), Class 3011 House construction (+0.1%) which was mainly influenced by New South Wales (+0.5%) and Western Australia (+0.5%) and Class 3020 – Non–residential building construction (+0.1%) which was mainly influenced by Queensland (+1.0%).

Through the year to the December quarter 2011, the price index of Subdivision 30 – Building construction rose 1.3% driven by increases in the prices received for Class 3020 – Non–residential building construction (+1.5%), Class 3019 – Other residential building construction (+0.9%), and Class 3011 – House construction (+1.2%).

The price index for Class 3101 – Road and bridge construction rose 1.2% for the December quarter 2011 which was mainly driven by increases in the prices received for Queensland (+1.2%) and New South Wales (+0.7%).

Through the year to the December quarter 2011, Class 3101 – Road and bridge construction rose 5.2%.

SERVICE INDUSTRIES PRODUCER PRICE INDEXES

DIVISION I – TRANSPORT, POSTAL AND WAREHOUSING

Division I – Transport, postal and warehousing recorded rises for the December quarter 2011 in the prices received for Group 461 – Road freight transport (+1.1%), Group 471 – Rail freight transport (+1.1%) and Group 530 – Warehousing and storage services (+0.8%).


DIVISION J – INFORMATION MEDIA AND TELECOMMUNICATIONS

Division J – Information media and telecommunications recorded rises for the December quarter 2011 in the prices received for Group 541 – Newspaper, periodical, book and directory publishing (+0.3%) (driven by Class 5411 – Newspaper publishing (+0.5%) and Class 5412 – Magazine and other periodical publishing (+0.2%)). Partly offsetting these rises were falls in the prices received for Group 592 – Data processing, web hosting and electronic information storage services (–0.3%).


DIVISION L – RENTAL HIRING AND REAL ESTATE SERVICES

Division L – Rental, hiring and real estate services recorded rises for the December quarter 2011 in the prices received for Class 6712 – Non–residential property operators (+0.8%). Partly offsetting these rises were falls in the prices received for Group 672 – Real estate services (–0.7%).


DIVISION M – PROFESSIONAL, SCIENTIFIC AND TECHNICAL SERVICES

Division M – Professional, scientific and technical services recorded rises for the December quarter 2011 in the prices received for Group 695 – Market research and statistical services (+0.3%). Partly offsetting these rises were falls in the prices received for Class 6962 – Management advice and related consulting services (–0.3%).


DIVISION N – ADMINISTRATIVE AND SUPPORT SERVICES

Division N – Administrative and support services recorded rises for the December quarter 2011 in the prices received for Group 731 – Building cleaning, pest control and gardening services (+1.3%) (driven by Class 7311 – Building and other industrial cleaning services (+1.0%) and Class 7312 – Building pest control services (+3.0%)), Group 721 – Employment services (+0.3%) (driven by Class 7212 – Labour supply services (+0.4%)) and Group 729 – Other administrative services (+0.2%) (driven by Class 7292 – Document preparation services (+0.7%) and Class 7299 – Other administrative services n.e.c. (+0.4%)).


DIVISION O – PUBLIC ADMINISTRATION AND SAFETY

Division O – Public administration and safety recorded rises for the December quarter 2011 in the prices received for Class 7712 – Investigation and security services (+0.8%).


DIVISION S – OTHER SERVICES

Division S – Other services recorded rises for the December quarter 2011 in the prices received for Class 9533 – Parking services (+1.0%).