Continued increase in PPI

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The producer price index (PPI) continued August’s increase in September, after having dropped continuously through 2020. The total index rose by 2.8 percent this month, with increased price on natural gas as the main driver.

The price on natural gas rose by over 40 percent from August, which together with increased prices on electricity, gas and steam lead to the total increase in PPI. The price on crude oil, on the other hand, fell by about 5 percent in September. This reduced the total increase, whereas the combined index for manufacturing industries stood at a no-change, despite some significant increases.

Figure 1. Price index, 2015=100

Manufacturing, total Extraction of crude oil and natural gas
Jan. 2015 98.91 98.88
Feb. 2015 99.78 104.28
March 2015 100.54 107.44
April 2015 100.79 107.4
May 2015 100.94 108.35
June 2015 101.09 110.55
July 2015 101.19 105.06
Aug. 2015 100.04 93.89
Sep. 2015 98.83 94.09
Oct. 2015 99.24 93.64
Nov. 2015 99.83 92.92
Dec. 2015 98.81 83.49
Jan. 2016 97.5 70.81
Feb. 2016 96.82 68.65
March 2016 97.05 70.59
April 2016 97.8 71.41
May 2016 99.23 75.85
June 2016 100.38 80.47
July 2016 101.7 80.71
Aug. 2016 100.52 78.18
Sep. 2016 100.04 75.49
Oct. 2016 100.55 78.76
Nov. 2016 101.39 81.97
Dec. 2016 102.1 96.15
Jan. 2017 104.12 94.54
Feb. 2017 106.06 99.31
March 2017 105.53 98.13
April 2017 105.84 90.75
May 2017 105.71 88.52
June 2017 105.02 83.81
July 2017 104.43 80.84
Aug. 2017 104.36 81.42
Sep. 2017 105.72 87.04
Oct. 2017 106.19 95.16
Nov. 2017 107.45 101.47
Dec. 2017 109.12 108.9
Jan. 2018 110.1 116.07
Feb. 2018 110.04 105.04
March 2018 109.9 106.94
April 2018 110.39 119.2
May 2018 112.81 121.03
June 2018 113.98 122.61
July 2018 113.87 123.93
Aug. 2018 113.46 126.23
Sep. 2018 113.56 131.61
Oct. 2018 115.04 144.69
Nov. 2018 114.85 131.38
Dec. 2018 113.12 119.29
Jan. 2019 112.51 120.76
Feb. 2019 113.64 122.19
March 2019 114.03 115.72
April 2019 114.88 116.94
May 2019 115.07 113.75
June 2019 114.17 99.8
July 2019 112.94 96.83
Aug. 2019 113.01 95.83
Sep. 2019 112.88 96.27
Oct. 2019 114.66 93.32
Nov. 2019 115.2 96.89
Dec. 2019 116.04 107.76
Jan. 2020 116.4 105.11
Feb. 2020 117.97 93.46
March 2020 116.45 72.25
April 2020 113.3 65.92
May 2020 111.35 60.27
June 2020 111.71 59.18
July 2020 112.63 57.06
Aug. 2020 112.67 59.89
Sep. 2020 112.71 65.16

Price increase on important metals

Of the industries with the mentioned price increases in September, metal industry was the largest contributor. The rise in prices on important non-ferrous metals were especially high, with an increase of 2.7 percent on the export market. One reason for this increase may have been that the Norwegian krone weakened slightly against both US dollars and Euro in September. Aluminum had a price increase measured in NOK of 14.2 percent, whereas nickel had an equivalent increase of 4.5 percent in September. As important export goods, the metal prices were significant contributary factors to the rise in the total index in September.

Continued increase on electricity

The electricity prices in PPI have faced large increases in the two latest months after mainly falling in the first half of 2020. Because of this, the percentagewise increase was large in September, albeit from a low base level. Compared to September 2019, the prices on electricity still lies lower, at 21 percent. On the export market this 12-month comparison gives 50 percent lower.

According to the Norwegian Water Resources and Energy Directorate (NVE), the electricity prices have ebbed and flowed over the weeks during September. Magazine fillings above normal levels and reductions in transfer capacity have been mentioned as reasons on the price decreasing side. On the price increasing side, large price increases in Europe is given as the main contributor. Very low production from wind and reduced production from nuclear plants and coal made the system price on the Nordic power exchange high. This system price is a cornerstone in price development for electricity in PPI, especially on the export market, where the increase was a little over 81 percent.

Fact sheet