The Producer Price Index (PPI) comprises of indices for local production, imports and domestic economy. The domestic economy price index is a composite index based on the price data derived from the local production and import price indices.

DOMESTIC ECONOMY

The PPI for domestic economy in January 2015 decreased by 0.4 per cent with the both local production and import price indices were moved down by 0.4 per cent. (Table 1).

Year-on-year comparison showed that the PPI for domestic economy decreased by 4.8 per cent with local production index dropped by 7.0 per cent and the import price index declined by 0.2 per cent.

IMPORTS

The import price index went down 0.4 per cent in January 2015 as compared to December 2014. The decrease in the index was attributed to the lower prices of goods transacted by importers for three (3) commodity sections as classified under SITC 4+ i.e Mineral fuels, lubricants etc. (-3.2%), Machinery and transport equipment (-0.2%) and Beverages & tobacco (-0.1%). However, Crude materials, inedible increase (+4.0%), Miscellaneous transactions and commodities (+1.7%), Animal and vegetable oils and fats (+0.9%), Food (+0.3%) and Chemicals (+0.2%). Meanwhile, Manufactured goods and Miscellaneous manufactured articles remained unchanged. [Table 3].

As compared with the same month of preceding year, the import price index for January 2015 moved down 0.2 per cent. The decrease in prices were found in three (3) commodity sections which comprised Mineral fuels, lubricants etc (-10.6%), Animal and vegetable oils and fats (-2.9%) and Chemicals (-0.1%). In contrast, indices for Miscellaneous transactions and commodities increase (+4.8%), Crude materials, inedible (+3.7%), Machinery and transport equipment (+1.7%), Food (+1.5%), Miscellaneous manufactured articles (+1.3%), Manufactured goods (+0.4%) and Beverages and tobacco (+0.1%).

Import Price Index by Stage of Processing

The decrease (-0.4%) in the import price index by stage of processing (SOP) for January 2015 as compared to previous month resulted from the decreases by the index for Crude materials for further processing (-2.3%) and Intermediate materials supplies and components (-0.3%). Mean while, index for Finished goods increase (+0.1%).

 As compared with January 2014, the import price index by SOP for January 2015 went down by 0.2 per cent. The drop for overall index were recorded by the decrease in the index for Crude materials for further processing 7.9 per cent. However, indices for Intermediate materials, supplies and components increase 0.9 per cent and Finished goods 0.6 per cent.

Background notes

Rebasing The Producer Price Index To 2010=100

Prior to this, the PPI was compiled based on 2005 as the base year, reflecting the weighting patterns of industry and producer price in the respective year. Effective from January 2015 publication, the PPI will be using 2010 as the base year. The rebasing will ensure that the index weighting system better reflects recent structure of economy by updating weighting patterns to reflect prices in 2010.

The PPI (2010=100) covers Agriculture, forestry & fishing; Mining; Manufacturing; Electricity & gas and Water supply sectors under Local Production. Meanwhile, PPI for Domestic Economy and Import Price Indices are compiled by reclassifying the commodities according to the Standard International Trade Classification (SITC).

The new index series also includes the change to the most recent classifications which are Malaysia Standard Industrial Classification (MSIC) 2008, Ver. 1.0 and Standard International Trade Classification (SITC) Rev.4.

Released By:

THE OFFICE OF CHIEF STATISTICIAN MALAYSIA
DEPARTMENT OF STATISTICS, MALAYSIA
27 February 2015