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


Producer Price Indexes - September 2006

The Producer Price Index for Finished Goods fell 1.3% in September, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This decline followed increases of 0.1% in both August and July. At the earlier stages of processing, prices received by manufacturers of intermediate goods moved down 1.4% in September after increasing 0.4% in the preceding month, and the crude goods index dropped 3.4% following a 2.2% gain in August.

Among finished goods in September, prices for energy goods declined 8.4% compared with a 0.3% increase in August. The finished consumer foods index rose 0.7 % after advancing 1.4 % in the prior month. By contrast, prices for finished goods other than foods and energy climbed 0.6 % in September following a 0.4% decline in August.

During the third quarter of 2006, prices for finished goods decreased at a seasonally adjusted annual rate (SAAR) of 4.4 % after moving up at a 6.4-% SAAR during the second quarter of 2006. Excluding prices for foods and energy, the finished goods index edged down at a 0.3% SAAR for the 3 months ended September 2006 subsequent to rising at a 2.3 % SAAR for the 3 months ended June 2006. Among prices for raw and partially processed goods, the intermediate goods index fell at a 1.9% SAAR in the third quarter of 2006 after climbing at a 10.3% SAAR from March to June 2006. The crude goods index moved up at an 8.0% SAAR for the 3 months ended September 2006 following a 6.4% rate of increase during the previous quarter.

Before seasonal adjustment, the Producer Price Index for Finished Goods decreased 1.1% in September to 160.3 (1982 = 100). From September 2005 to September 2006, prices for finished goods rose 0.9%. Over the same period, the index for finished goods other than foods and energy went up 1.2%, prices for finished consumer foods climbed 2.2%, and the finished energy goods index declined 1.8%. For the 12 months ended September 2006, intermediate goods prices advanced 4.7%, and the crude goods index decreased 7.8%.

Finished goods

The index for finished energy goods declined 8.4 % in September following a 0.3% gain in August. Over half of this downturn was due to gasoline prices, which dropped 22.2% in September subsequent to a 2.2% decrease in the previous month. The indexes for home heating oil, liquefied petroleum gas, residential electric power, and diesel fuel turned down after rising in August. By contrast, the index for residential natural gas advanced 1.8% in September following a 1.6% increase in the prior month. During the third quarter of 2006, prices for finished energy goods fell at a 24.7-% SAAR after moving up at a 22.3% SAAR during the second quarter of 2006.

The rate of increase in the index for finished consumer foods slowed from 1.4% in August to 0.7% in September. Prices for fresh and dry vegetables rose 3.5% after jumping 20.7% in the previous month. The index for eggs for fresh use also rose less than it had in August. The indexes for fresh fruits and melons, processed young chickens, and processed turkeys turned down in September following increases a month earlier. Prices for confectionery end products decreased after remaining unchanged in the preceding month. Alternatively, finfish and shellfish prices advanced 6.7% in September following a 9.1% decline in August. Prices for beef and veal also turned up after falling in August, and the index for pork rose at a faster rate than it had in the prior month. From June to September 2006, the index for finished consumer foods advanced at a 7.6% SAAR after increasing at a 3.7% SAAR for the 3 months ended June 2006.

Prices for finished consumer goods other than foods and energy increased 0.5 % in September after falling at the same rate in the previous month. The light motor trucks index climbed 3.5 % following a 3.4% decline in August. Prices for passenger cars, alcoholic beverages, and mobile homes also turned up in September after decreasing a month earlier. The index for pharmaceutical preparations fell less than it had in the prior month, while prices for soaps and synthetic detergents rose after remaining unchanged in August.

By contrast, the index for household appliances moved down 1.4 % subsequent to a 0.7% gain in the preceding month. Prices for men''s and boys'' apparel increased at slower rates in September compared with the previous month. The index for women''s, girls'', and infants'' apparel was unchanged following an increase in August. During the third quarter of 2006, the index for finished consumer goods other than foods and energy decreased at a 1.0% SAAR after advancing at a 2.2-% SAAR from March to June 2006.

Capital equipment prices increased 0.6 % in September after falling 0.3 % in August. The index for passenger cars moved up 2.8% following a 2.6-% decline in the prior month. Prices for light motor trucks, communication and related equipment, commercial furniture, and for x-ray and electromedical equipment also turned up in September after declining a month earlier. y contrast, the civilian aircraft index was unchanged following a 0.4% gain in August. Prices for industrial material handling equipment advanced less in September than they had in the preceding month. The index for truck trailers turned down after increasing in August. For the 3 months ended September 2006, capital equipment prices rose at a 0.5% SAAR after climbing at a 2.5-% SAAR for the 3 months ended June 2006.

Intermediate goods

The Producer Price Index for Intermediate Materials, Supplies, and Components decreased 1.4 % in September following a 0.4% increase in August. Most of this downturn can be traced to prices for intermediate energy goods, which fell after rising in the prior month. The index for materials for nondurable manufacturing also turned down, while prices for materials and components for construction advanced less in September than they had a month earlier. Alternatively, the index for intermediate foods and feeds moved up following a decline in the prior month, and prices for materials for durable manufacturing increased more than they had in August. Excluding foods and energy, prices for intermediate goods edged up 0.1 % in September after rising 0.4% in the preceding month.

The index for intermediate energy goods decreased 7.5% in September following a 0.7-% advance in August. Diesel fuel prices dropped 22.3 % after increasing 2.7 % in the prior month. The indexes for jet fuel, home heating oil, liquefied petroleum gas, and residual fuel also moved down in September following advances a month earlier. Gasoline prices fell more than in August, while the indexes for industrial natural gas and natural gas to electric utilities increased less in September than they had in the previous month. Conversely, the index for commercial natural gas climbed 3.0 % in September compared with a 1.8% gain in August. Prices for commercial electric power decreased less than they had in the preceding month. (See table 2.) The intermediate energy goods index declined at a 24.8-% SAAR during the third quarter of 2006 after advancing at an 18.2-% SAAR during the second quarter of 2006.

The index for materials for nondurable manufacturing fell 1.5 % in September following a 0.2-% increase in August. Leading this downturn, prices for basic organic chemicals decreased 4.0 % after rising 2.0 % in the prior month. The indexes for inedible fats and oils and for gray fabrics also moved down in September following advances a month earlier. Prices for plastic resins and materials and for stemmed and redried tobacco were unchanged after rising in August, while the indexes for paperboard and paper increased less than in the previous month. By contrast, prices for nitrogenates climbed 4.5 % in September following a 6.0-% drop in the preceding month. The index for synthetic fibers also turned up after falling in August. Prices for materials for nondurable manufacturing declined at a 4.4-% SAAR for the 3 months ended in September after moving up at a 10.8-% SAAR for the 3 months ended in June.

The index for materials and components for construction rose 0.2% in September following a 0.4-% increase in August. Prices for fabricated structural metal products were unchanged after climbing 1.0% in the prior month. The nonferrous wire and cable index moved up less in September than it had a month earlier. Prices for concrete products, gypsum products, paving mixtures and blocks, hardwood lumber, and plastic construction products turned down following advances in August. Conversely, the softwood lumber index moved up 0.7 % in September after dropping 5.6 % in the previous month. Prices for treated wood also turned up following declines in August. The plywood index fell less in September than it had in the preceding month, while prices for steel mill products and for air conditioning and refrigeration equipment increased more than in the prior month. The index for materials and components for construction rose at a 5.2-% SAAR in the third quarter of 2006 after advancing at a 7.8-% SAAR in the second quarter of 2006.

The index for intermediate foods and feeds increased 0.8 % in September compared with a 0.2% decrease in August. Flour prices moved up 1.7 % after falling 5.1 % in the prior month. The beef and veal index also turned up in September following a decline a month earlier. Prices for pork and for natural, processed, and imitation cheese rose more than they had in August, while the indexes for prepared animal feeds and for refined sugar and byproducts fell less than in the previous month. By contrast, prices for processed young chickens decreased 0.6% in September after advancing 4.6 % in August. The index for dry, condensed, and evaporated milk products increased less than it had in the preceding month. Prices for intermediate foods and feeds climbed at a 3.9% SAAR for the 3 months ended in September after moving down at a 0.9% SAAR for the 3 months ended in June.

The index for materials for durable manufacturing advanced 0.5% in September following a 0.4-% gain in August. In September, rising prices for cold rolled steel sheet and strip; hot rolled steel sheet and strip; hot rolled steel bars, plates, and structural shapes; softwood lumber; prepared paint; and cement outweighed falling prices for aluminum mill shapes, primary aluminum (except extrusion billet), cold finished steel bars, building paper and board, and hardwood lumber. The index for materials for durable manufacturing increased at a 13.4-% SAAR in the third quarter of 2006 after surging at a 29.6-% SAAR in the second
quarter of 2006.