Canadian Industrial Product Price Index Moves Higher in April Thanks to Increased Lumber and Wood Product Costs

Statistics Canada is reporting that prices for products manufactured in Canada, as measured by the Industrial Product Price Index (IPPI) rose 1.6% month over month in April and was 14.3% higher when compared with April 2020. The increase in the IPPI marks the fifth consecutive monthly increase. Excluding energy and petroleum products, the IPPI was up 1.8%. Of the 21 major commodity groups, 18 were up and 3 were down. The increase in the IPPI was driven mostly by higher prices for lumber and other wood products (+6.4%), which have been on the rise since December 2020. Steadily increasing prices for softwood lumber (+10.1%) led this growth. Over one year, softwood lumber prices have climbed 169.4%, their largest year-over-year increase in history. Persistent demand for softwood lumber in the United States and Canada for construction and residential renovations, combined with lower supply, drove this category upward. Prices of raw materials purchased by manufacturers operating in Canada, as measured by the Raw Materials Price Index (RMPI), increased 1.0% on a monthly basis in April and 56.4% compared with April 2020.