Producer Prices Continued to Rise in March due to Commodity Price Shocks

• For March 2022, output prices for producers in the Mining and Quarrying industry increased by 0.7%, which was higher than February’s outturn of 0.5%. The movement was mainly attributed to a 0.7% rise in the index for the major group ‘Bauxite Mining & Alumina Processing’. 
• Year-to-date, aluminum prices have increased by 7.4% based on data from Markets Insider. The market has been impacted by the substantial increase in energy and raw material costs, growing demand, decline in China’s production capacity, and fears over supply issues following the sanctions against Russia, which placed upward pressure on prices. 
• The index for the Manufacturing industry also increased by 2.4%. The main contributors to the increase in the index for the Manufacturing industry were the major groups, ‘Refined Petroleum Products’ up by 7.3%, ‘Food, Beverages & Tobacco’ which moved up by 1.4% and ‘Wood and Wood Products and Furniture’ up by 0.9%’. Along with the other industries the manufacturing industry continues to be adversely affected by higher costs for shipping and raw materials on the international market owing to both the lingering effects of the pandemic and the current geopolitical tensions between Russia-Ukraine. 
• These March outturns contributed to a 12-month point-to-point (March 2021 – March 2022) increase in both the Mining & Quarrying and Manufacturing industry indices of 35.9% and 22.0%, respectively. It is anticipated that these indices will rise further in the near term as the Russia-Ukraine conflict and its impact on commodity prices continue to unfold.

(Sources: STATIN & NCBCM Research)