The Chinese government reported that the Producers Price Index (PPI) for manufactured goods rose by 6.1% in January over the same month last year. Purchasing prices for raw material, fuels and power rose by 8.9%, according to the National Bureau of Statistics of China. By comparison, the PPI for manufactured goods rose 3.1% in all of 2007 and 5.4% during the December over December period.
Cost pressures were highest in the earliest stages of production due to rising commodity and energy prices. The PPI for means of production increased 6.5% over last January, due to an 8.5% increase in the PPI for the raw materials industry and a 3.8% increase for the manufacturing industry. For the consumer goods sector, the index rose 4.6%, including 10.4% for foodstuffs, 2.2% for clothing and 3.0% for commodities. The PPI for durable consumer goods dropped 0.6%.
The price increases were driven by a 29.9% rise in the PPI for crude oil. The prices for refined products, such as gasoline, diesel and kerosene rose 7.3%, 10.0% and 10.9 % respectively. The PPI for crude coal, meanwhile, rose 14.9%. PPI for polystyrene dropped 4.9% compared with the same month a year ago. While the prices producers pay for latex surged 20.7, prices for terylene declined 0.2%, year on year.
The PPI for manufactured goods and means of production have taken a sharp upward turn since October. The government said China's Consumer Price Index rose 7.1% during the month.