According to Statistics Canada, prices of products manufactured in Canada, as measured by the Industrial Product Price Index (IPPI), rose 0.7 percent on a monthly basis in February and fell 1.7 percent relative to February 2023. Prices of raw materials purchased by manufacturers operating in Canada, as measured by the Raw Materials Price Index (RMPI), increased 2.1 percent month over month in February 2024 and decreased 4.7 percent year over year.
The IPPI rose 0.7 percent month over month in February, following four months of consecutive declines. This increase was driven by higher prices for energy and petroleum products. Excluding energy and petroleum products, the IPPI edged up 0.1 percent.
The IPPI fell 1.7 percent in February 2024 relative to February 2023. This was the fifth consecutive year-over-year decline.
In February, the RMPI rose 2.1 percent on a monthly basis, after posting a 1.2 percent increase in January.
Higher prices for crude energy products (+5.7 percent) led the increase in the RMPI in February. Conventional crude oil prices were up 6.1 percent and synthetic crude oil rose 10.1 percent. Despite the six-week consecutive increase in US crude inventories, the sustained high crude prices this month were partly influenced by the ongoing tensions in the Middle East and the expectation of OPEC+ to extend production restrictions into March. Furthermore, greater-than-anticipated demand from Asia influenced the upward trajectory of oil prices.
Metal ores, concentrates and scrap edged down 0.1 percent in February. The decline was driven by iron ores and concentrates (-7.9 percent). Weak demand and high inventories in China partly drove iron ore prices down. Partially offsetting the decrease, nickel ores and concentrates rose 2.0 percent, posting the first monthly increase since April 2023 (+1.1 percent). A slowdown in production and lower level of stock in Indonesia, the world's top producer of nickel, put upward pressure on prices in February 2024. Concerns that nickel would be affected by new Western sanctions against Russia, another major producer of the metal, also played a part in higher prices.
The RMPI decreased 4.7 percent year over year in February, the fifth consecutive year-over-year decline.