Canadian Industrial Product and Raw Materials Price Indices for December

On Wednesday, Statistics Canada (StatCan) released the results of its December Industrial Product Price Index (IPPI) and Raw Materials Price Index (RMPI).

Industrial Product Price Index

The IPPI rose 0.2% month-over-month and 4.1% year-over-year.

StatCan notes that prices for some products in the IPPI are reported in US dollars, so changes in the CAD/USD exchange rate can exert an influence on the index. The Canadian dollar depreciated 1.9% against the US dollar from November to December. If the exchange rate for prices reported in US dollars had remained constant from November to December, the IPPI would have decreased 0.1% month-over-month instead of increasing 0.2%.

Lumber and other wood products prices increased 1.3% in December. This was the fifth straight monthly increase for the product group. Higher prices for softwood lumber, up 2.7%, were the key reason for December’s monthly gain. Following a weak fall harvesting season, prolonged downtime and temporary layoffs at some Canadian sawmills caused supply constraints that contributed to this price increase, StatCan said.

Raw Materials Price Index

The RMPI grew 1.3% on a monthly basis in December, after edging 0.1% lower in November.

Year-over-year, the RMPI was up 9.1%. The December movement was partially influenced by a base period effect, as the RMPI declined 4.9% in December 2023.