Mfg prices down 8.1% in Sept

MANILA, Philippines – Manufacturing prices had fallen 8.1 percent in September this year, versus an upward 0.8 percent in the same month last year, latest government data showed.

According to the Philippine Statistics Authority (PSA), the downtrend was brought about by the double-digit declines of the heavily-weighted sectors namely petroleum products (22.2 percent), electrical machinery (17 percent) and basic metals (13.8 percent), including the significant decreases posted by furniture and fixtures ( 39.9 percent) and wood and wood products (19.1 percent).

On the other hand, 10 sectors posted single-digit increases in prices led by beverages, which expanded by eight percent.

On a month-on-month performance, the producers price index bounced back posting an increase of 0.6 percent from a negative 0.1 percent during the previous month.

The turnaround was mainly due to positive growth rates of the two heavily-weighted sectors: electrical machinery (up 4.5 percent) and petroleum products (3.1 percent).

Meanwhile, six major sectors posted decreases, while three sectors reflected flat expansions.

The PPI, a designated statistics, is generated through the results of the Producer Price Survey (PPS) conducted nationwide. The survey gathers monthly producer prices of select products of establishments included in the market basket.

The PPI is used as a deflator of the monthly integrated survey of selected industries (MISSI) to derive indicators for the Volume of Production Index (VoPI) and Volume of Net Sales (VoNSI).

The PSA explained that the PPI utilizes the Paasche-type method of index computation.

The weights are computed from the value of production to derive concentration ratios from the Census of Philippine Business and Industry (CPBI) or Annual Survey of Philippine Business and Industry (ASPBI). The weights are updated as soon as new results of the ASPBI or CPBI are available and applied at the beginning of each survey year.

For the 2014 PPI, the weights of the major sectors and sub-sectors were computed from the results of the 2010 ASPBI for Manufacturing Establishments with total employment of 20 and over, the latest survey results.

Starting with January 2013 as reference month, the PPI utilized the 2009 Philippine Standard Industry Classification (PSIC) to classify sectors and industries.