Industrial Product Price Index: Flash estimates, April 2020
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Released: 2020-05-08
To provide Canadians with timely economic data, Statistics Canada is releasing early estimates of the Industrial Product Price Index (IPPI) for April 2020. These flash estimates will be revised when the IPPI is officially released on May 29, 2020. Because flash estimates are calculated using preliminary data, these values should be used with caution.
In April, prices for products manufactured in Canada, as measured by the IPPI, fell 1.2% month over month. This is the fourth consecutive monthly decline in the IPPI and the largest drop since June 2019 (-1.4%).
The primary contributor to the decline was a 13.6% decrease in prices for energy and petroleum products. This was also the fourth consecutive monthly drop in prices for energy and petroleum products, following a 16.5% decrease in March. Excess supply of petroleum, combined with low demand because of COVID-19, placed downward pressure on the price of crude oil in April. In the latter half of the month, prices for West Texas Intermediate—the reference US crude oil price—briefly became negative, which was an unprecedented occurrence.
In response to falling prices, oil producers worldwide made efforts to control supply. The OPEC+ coalition, led by Saudi Arabia and Russia, agreed to curb production by 9.7 million barrels per day (MMb/d). By the end of April, US weekly oil production fell to 12.1 MMb/d, a substantial decrease from the record weekly high of 13.1 MMb/d in March. Other non-OPEC members—including Canada, Norway and Brazil—also reduced petroleum production.
Excluding energy and petroleum products, the IPPI increased 0.4%, mainly because of higher prices for meat, fish and dairy products (+2.5%), including fresh and frozen pork (+10.7%) and fresh and frozen beef and veal (+7.1%). Lower supply, stemming from meat plant closures because of COVID-19, contributed to these price increases.
Chart 1
Industrial Product Price Index (2018 to 2020)
Chart 2
Fresh and frozen pork and fresh and frozen beef and veal (2018 to 2020)
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