UPDATE 2-Canada producer prices climb higher on vehicles

Mon Jan 6, 2014 1:30pm EST
 
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* Industrial product prices rise 0.1 pct on month, 0.3 pct on year

* Raw materials prices fall 4.1 percent in Nov, down 2.5 pct on year

OTTAWA, Jan 6 (Reuters) - Canadian producer prices edged up 0.1 percent in November, as expected, mainly because of higher prices for motorized and recreational vehicles, Statistics Canada said on Monday.

The increase in the industrial product price index (IPPI) followed two straight months of declines and brought the year-on-year gain to 0.3 percent.

Raw materials prices fell 4.1 percent in November, mainly due to crude energy products.

With the release of the latest data, Statscan updated the two indices to make 2010 the base year and the weighting of various goods in the basket now reflects 2010 manufacturing production. It also converted the classification system to the North American Product Classification System.

Under the new methodology, producer prices fell by 0.5 percent in October versus the 0.3 percent decline reported using the prior methodology.

Statscan data now shows raw materials prices declined 3.3 percent. The previous data showed a 2.3 percent drop.

Of the major commodity groups in the IPPI, 15 registered higher prices, two were down and four were unchanged. Other big contributors to the increase were primary ferrous metal products, pulp and paper products, chemical products and electrical, electronic, audiovisual and telecommunications products. On the other hand, primary non-ferrous metals declined.

Analysts in a Reuters poll had forecast a 0.1 percent increase in producer prices in the month and 1.8 percent drop in raw materials prices.