Canadian Industrial Product and Raw Materials Price Indices for February

On Thursday, Statistics Canada (StatCan) released its Industrial Product and Raw Materials Price Indices for February.

Industrial Product Price Index (IPPI)

The IPPI rose 0.4% month-over-month in February, marking its fifth consecutive monthly increase.

Higher prices for primary non-ferrous metal products contributed to the gain, rising 3.1% in February and extending a three-month streak of increases. These gains were partially offset by a 1.2% decline in lumber and other wood product prices, following six consecutive monthly increases. Lower prices for softwood lumber, down 3.4%, contributed the most to the February decrease, as cold weather patterns slowed down buying activity, StatCan said.

Year-over-year, the IPPI was up 4.9%, following a 5.6% increase in January. Most product groups posted annual gains.

Raw Materials Price Index (RMPI)

The RMPI increased 0.3% month-over-month in February, following a 3.5% rise in January. Excluding energy products, the index climbed 3.4%.

Year-over-year, the RMPI was up 9.3%, marking its fourth consecutive annual increase. Excluding crude energy products, the index rose 16.2% from a year earlier.

2024 Wood Products Review

In its 2024 review, StatCan highlighted lumber and other wood products, noting that prices rose 2.2% for the year after consecutive declines of 24.0% in 2023 and 3.0% in 2022, as rising interest rates weighed on demand.

By contrast, lumber prices surged in 2020 and 2021, rising 19.6% and 40.4%, respectively, driven by strong demand for new housing and home renovations.

The primary driver of the 2024 increase was softwood lumber, which rose 6.2%, with most of the gains occurring in the second half of the year. Canadian sawmill curtailments and closures, prompted by high operating costs, reduced supply and pushed prices higher, StatCan said.

Compared with 2019, lumber prices were 26.6% higher in 2024.