The following is the unedited transcript of the news release from the U.S. Department of Labor.


The Producer Price Index for Finished Goods declined 0.1 percent in December, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This decrease followed a 3.2-percent rise in November and a 0.1-percent advance in October. At the earlier stages of processing, prices received by producers of intermediate goods fell 0.2 percent in December after increasing 3.7 percent in the prior month, and the crude goods index moved up 1.0 percent following an 8.7-percent jump in November.

The downturn in prices for finished goods was led by the index for energy goods, which dropped 1.9 percent in December after climbing 14.1 percent in November. Prices for finished goods other than foods and energy rose 0.2 percent in December compared with a 0.4-percent advance in the preceding month. By contrast, partially offsetting the downturn in the finished goods index, prices for finished consumer foods increased 1.3 percent following no change in November.

Before seasonal adjustment, the Producer Price Index for Finished Goods declined 0.4 percent in December to 170.6 (1982 = 100). In 2007, finished goods prices moved up 6.3 percent compared with a 1.1-percent advance in 2006. This faster rate of increase in 2007 is attributable to food and energy prices. The index for finished energy goods surged 18.4 percent in 2007 after falling 2.0 percent a year earlier, and prices for finished consumer foods jumped 7.4 percent following a 1.7-percent rise in 2006. Alternatively, the index for finished goods other than foods and energy advanced 2.0 percent in 2007, the same as in the preceding year. At the earlier stages of processing, prices received by manufacturers of intermediate goods climbed 6.8 percent in 2007 after moving up 2.8 percent in the prior year, while the crude goods index jumped 20.6 percent following a 4.7-percent decrease in 2006.

Finished goods

The index for finished energy goods fell 1.9 percent in December after rising 14.1 percent in November. Leading this downturn, gasoline prices declined 4.8 percent in December following a 34.8-percent surge a month earlier. The indexes for home heating oil, diesel fuel, liquefied petroleum gas, asphalt, and kerosene also decreased after advancing in November. Prices for residential electric power moved up less in December than in the previous month. By contrast, partially counteracting the downturn in the index for finished energy goods, prices for residential natural gas fell 0.1 percent compared with a 5.2-percent drop in November.

The index for finished goods other than foods and energy increased 0.2 percent in December following a 0.4-percent rise in November. In December, higher prices for pharmaceutical preparations, cosmetics and other toilet preparations, civilian aircraft, commercial furniture, cigarettes, pet food, and floor coverings outweighed lower prices for passenger cars, light motor trucks, household furniture, and for x-ray and electromedical equipment.

The index for finished consumer foods climbed 1.3 percent in December after no change in November. Prices for fresh and dry vegetables jumped 13.4 percent in December compared with a 13.2-percent drop in the preceding month. The indexes for beef and veal and for processed fruits and vegetables also turned up in December. Prices for fresh fruits and melons and for eggs for fresh use increased more than they had in November. By contrast, the index for processed turkeys fell 9.4 percent in December following an 8.7-percent rise in the prior month. Prices for pork and roasted coffee also decreased after advancing in November. The indexes for bakery products, finfish and shellfish, and processed young chickens increased at slower rates in December than they had a month earlier.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components decreased 0.2 percent in December following a 3.7-percent advance in November. Leading this downturn, prices for intermediate energy goods and materials for durable manufacturing declined after rising a month earlier. The index for materials for nondurable manufacturing rose less than it had in the preceding month. By contrast, partially offsetting the downturn in intermediate goods prices, the index for intermediate foods and feeds advanced more than it had a month earlier, and prices for materials and components for construction turned up in November. The index for intermediate goods less foods and energy was unchanged in December following a 1.0-percent decrease in the prior month.

The index for intermediate energy goods declined 1.4 percent in December subsequent to a 13.3-percent advance in November. Diesel fuel prices moved down 3.0 percent after surging 35.8 percent in the preceding month. The indexes for gasoline, home heating oil, both commercial and industrial electric power, and liquefied petroleum gas also turned down in December. Prices for jet fuels rose less than they had a month earlier, and the index for natural gas to electric utilities fell more than it had in November. By contrast, prices for commercial natural gas increased 0.6 percent following a 6.0-percent decline in the previous month. The index for industrial natural gas also turned up in December. (See table 2.) From December 2006 to December 2007, prices for intermediate energy goods advanced 18.6 percent after decreasing 3.3 percent a year earlier.

Prices for materials for nondurable manufacturing edged up 0.1 percent in December subsequent to a 3.6-percent rise in November. The index for processed yarns and threads moved up 0.2 percent following a 1.0-percent gain in the preceding month. Prices for basic organic chemicals, plastic resins and materials, and for paint materials declined after increasing in the prior month. By contrast, the rate of increase for the inedible fats and oils index quickened from 4.4 percent in November to 9.5 percent in December. Prices for fertilizer materials and basic inorganic chemicals also advanced more than they had a month earlier. The paperboard index inched up subsequent to a decline in the previous month. The index for materials for nondurable manufacturing advanced 13.0 percent in 2007 compared with a 1.2-percent rise in 2006.

Prices for materials for durable manufacturing decreased 1.0 percent in December following a 1.1-percent advance in November. The primary nonferrous metals index fell 8.5 percent after rising 2.5 percent in the prior month. Prices for thermoplastic resins, building paper and board, and aluminum mill shapes also turned down in December. The indexes for both cold and hot rolled steel sheet and strip rose less than in the preceding month. By contrast, prices for softwood lumber moved down 0.6 percent compared with a 3.8-percent decrease a month earlier. The index for copper and brass mill shapes also declined less than it had in the previous month, and prices for titanium mill shapes turned up in December. In 2007, the index for materials for durable manufacturing moved up 1.6 percent subsequent to a 12.5-percent jump in 2006.

The advance in the intermediate foods and feeds index accelerated from 1.2 percent in November to 2.2 percent in December. Prices for beef and veal moved up 3.2 percent compared with a 5.0-percent decline a month earlier. The indexes for flour and for refined sugar and byproducts also turned up in December. Prices for shortening and cooking oils advanced more than in the preceding month, while the index for dry milk products fell less than it had in November. By contrast, prices for prepared animal feeds increased 1.7 percent in December following a 3.7-percent advance in the prior month. Similarly, prices for processed young chickens also rose less then they had in November. The pork index turned down in December, and prices for fluid milk products declined more than they had in the previous month. From December 2006 to December 2007, the index for intermediate foods and feeds climbed 17.5 percent subsequent to a 4.7-percent increase a year earlier.



The index for materials and components for construction inched up 0.1 percent in December compared with a 0.1-percent decline in November. Prices for asphalt felts and coatings advanced 2.1 percent following a 2.6-percent decrease in the previous month. The indexes for nonferrous wire and cable and for softwood lumber fell less than they had a month earlier. Prices for fabricated structural metal products rose more than in November. By contrast, the index for steel mill products moved up 0.8 percent after increasing 2.3 percent in November. Prices for building paper and board, millwork, and treated wood turned down December. During 2007, prices for materials and components for construction advanced 1.8 percent after rising 4.3 percent in the previous year.

Crude goods

The Producer Price Index for Crude Materials for Further Processing rose 1.0 percent in December after advancing 8.7 percent in November. Rising prices for foodstuffs and feedstuffs outweighed price decreases for energy materials, while the index for basic industrial materials was unchanged in December. Prices for crude foodstuffs and feedstuffs climbed 4.3 percent after increasing 2.0 percent in the preceding month. The slaughter hogs index rose 9.5 percent following a 7.9-percent decline in November. Prices for wheat; fresh vegetables, except potatoes; and slaughter cattle also turned up in December. By contrast, slightly counteracting the acceleration in prices for crude foodstuffs and feedstuffs, the index for slaughter broilers and fryers fell 5.1 percent after moving down 0.8 percent in November. Prices for Irish potatoes for processing and for soybeans rose less than they had in the prior month. The fluid milk index turned down in December. In 2007, crude foodstuffs and feedstuffs prices jumped 25.2 percent following a 2.8-percent increase in 2006.

The index for crude energy materials fell 0.7 percent in December after climbing 17.0 percent a month earlier. Crude petroleum prices turned down 2.4 percent following a 15.5-percent gain in November. Price advances for natural gas slowed to 0.9 percent in December after jumping 21.6 percent in the previous month. Conversely, the coal index increased 1.4 percent after moving up 0.5 percent in the prior month. In 2007, prices for crude energy materials advanced 17.2 percent following a 15.7-percent drop in 2006.

The basic industrial materials index was unchanged in December after decreasing 0.5 percent a month earlier. Iron and steel scrap prices turned up 5.7 percent following a 7.6-percent decrease in November. The index for copper base scrap fell less than in November. Prices for raw cotton and phosphates rose more than they had a month earlier. The index for softwood logs, bolts, and timber was unchanged after falling in the prior month. By contrast, prices for aluminum base scrap declined 3.2 percent in December following a 1.5-percent advance a month earlier. The index for wastepaper also turned down after rising in November. Prices for gold ores increased less than they had in the preceding month. The basic industrial materials index climbed 16.8 percent in 2007, slightly less than the 17.0-percent rise in 2006.

Net output price indexes

Mining, Utilities, and Manufacturing Industries.

The Producer Price Index for the Net Output of Total Mining, Utilities, and Manufacturing Industries turned down 0.6 percent in December after rising 1.9 percent in November. (Net output price indexes are not seasonally adjusted.) The index for the petroleum and coal products industry group declined 6.0 percent following a 14.1-percent jump a month earlier. Prices received by the industries for oil and gas extraction, transportation equipment, and natural gas distribution also fell after moving up in November. The index for the chemical manufacturing industry group increased less than in the prior month. By contrast, partially offsetting the downturn in the total mining, utilities, and manufacturing industries index, prices received by electric power generators turned up 1.1 percent in December after falling 2.3 percent in the preceding month. The index for the food manufacturing industry group increased more in December than in the previous month, and prices received by the computer and electronic products industry group were unchanged after falling in November.

Trade Industries.

The Producer Price Index for the Net Output of Total Trade Industries turned up 1.5 percent in December after decreasing 0.7 percent in November. (Trade indexes measure changes in margins received by wholesalers and retailers.) The margin index for gasoline stations jumped 41.1 percent in December following a 9.0-percent decrease a month earlier. Margins received by merchant wholesalers of durable goods, building materials and supplies dealers, and fuel dealers also turned up after falling in November. By contrast, the margin index for merchant wholesalers of nondurable goods dropped 5.6 percent in December following a 0.7-percent decline in the preceding month. Margins received by clothing stores, electronic shopping and mail order houses, and automobile dealers turned down after rising in November.