Export and import price indices - December 2007

In December 2007, export prices decreased by 1.3% and import prices by 0.6%, month-on-month. Year-on-year, export prices fell by 2.1% and import prices by 1.3%. The terms of trade figures reached 99.3%, m-o-m, and 99.2% y-o-y.
Comparing the average values over the year 2007 with the year 2006, export prices increased by 1.3%, import prices decreased by 1.0% and the terms of trade figure reached 102.3%.
Month-on-month comparison:

- Exports : export prices decreased already for the sixth successive month, this time by 1.3%, particularly due to the appreciation of the koruna. The drop of the total m-o-m export price index came mainly from a 1.4% decrease in prices of 'machinery and transport equipment' (particularly power-generating machinery and equipment). Price drops were registered for all sections except ‘animal and vegetable oils’. Among sections important in terms of weight the most significant price drops were recorded in ‘crude materials, inedible, except fuels’ (-1.9%), 'manufactured goods classified chiefly by material’ (-1.4%) and in ‘miscellaneous manufactured articles’ (-1.2%).

- Imports: Like in exports, import prices decreased for the sixth month in a row, in December by 0.6% which was led mainly by the appreciation of the koruna. The decrease of the total m-o-m import price index, like in exports, was driven mainly by a 1.1% fall in prices of 'machinery and transport equipment’ (particularly power-generating machinery and equipment). Marked decreases were also recorded for prices of 'manufactured goods classified chiefly by material’ by 1.7% (especially non-ferrous metals), ‘miscellaneous manufactured articles’ by 0.9% and ‘chemicals and related products’ by 0.6%. Among sections important in terms of weights, the price growth was recorded only in ‘mineral fuels, lubricants and related materials’ by 2.4% (especially gas).

- The terms of trade figure stood at 99.3% in December (the same value as in November) remaining below 100% for the third successive month. The lowest terms of trade figures were recorded for 'mineral fuels, lubricants and related materials' (96.2%) and ‘beverages and tobacco' (98.4%). 'Machinery and transport equipment' reached 99.7%. Among sections important in terms of weight, positive terms of trade figure was recorded only for 'manufactured goods classified chiefly by material’ (100.3%).

Year-on-year comparison:

- Exports: export prices decreased by 2.1% in December (by 1.4% in November) and they dropped for the second month in a row. The underlying reason was the appreciation of the koruna. The highest price decreases were registered in ‘machinery and transport equipment’ by 4.1% (especially road vehicles), 'miscellaneous manufactured articles' by 3.7% and ‘chemicals and related products’ by 2.7%. In contrast, the highest price growth among important sections was recorded for ‘food and live animals’ by 14.3% (especially cereals and cereal preparations).

- Imports: import prices decreased for the fifth successive month, this time by 1.3% (by 1.6% in November), mainly due to the appreciation of the koruna. The drop of the total y-o-y import price index was mainly affected by a 4.7% price decrease in 'machinery and transport equipment' (especially office machines and automatic data-processing machines). Considerable price decreases were observed also in 'miscellaneous manufactured articles' by 5.0%, ‘manufactured goods classified chiefly by material’ by 4.6% and ‘chemicals and related products' by 1.5%. Prices in the other sections increased, more significantly in ‘mineral fuels, lubricants and related materials' by 17.6%, ‘crude materials, inedible, except fuels’ by 6.1% and ‘food and live animals’ by 4.9% (especially vegetables and fruit).

- The terms of trade figure stood at 99.2% in December (100.2% in November), when it fell for the sixth month in a row and got down into negative values for the first time since August 2006. The lowest terms of trade figures were recorded for ‘mineral fuels, lubricants and related materials' (91.4%), 'crude materials, inedible, except fuels' (94.6%) and ‘chemicals and related products’ (98.8%). On the contrary, terms of trade figures above 100.0%, among important sections, were recorded for ‘food and live animals’ (109.0%), ‘manufactured goods classified chiefly by material’ (103.8%) and 'miscellaneous manufactured articles' (101.4%). Terms of trade value for the most important section 'machinery and transport equipment' was 100.6%.
Year-on-year comparison:

- Over the year 2007, on average, export prices increased by 1.3% (-1.2% in 2006); in contrast, import prices decreased by 1.0% (+0.3% in 2006). The external trade prices in the year 2007 were mainly affected by appreciation of the koruna towards Euro and US dollar which pushed down the indices while, the growth of prices in sections ‘crude materials, inedible, except fuels’ (especially metalliferous ores) and ‘food and live animals’ pushed them up.

- The most significant growth in export prices recorded ‘crude materials, inedible, except fuels’ (particularly metalliferous ores) by 12.6%. Among more important observed sections, prices of ‘manufactured goods classified chiefly by material’ increased by 3.7% and prices of ‘food and live animals’ by 12.2%. Decrease was registered only for prices in 'machinery and transport equipment' (especially telecommunications and sound-recording and reproducing apparatus and equipment) and 'miscellaneous manufactured articles', both by 0.8%.

- The most marked decrease in import prices showed 'machinery and transport equipment' by 3.7% (especially office machines and automatic data-processing machines), 'miscellaneous manufactured articles' by 3.0% and ‘mineral fuels, lubricants and related materials' by 1.3%. On the contrary, among more important sections the highest increase recorded prices of ‘crude materials, inedible, except fuels’ by 7.1% (especially metalliferous ores), prices of ‘food and live animals’ grew by 2.8% and prices of ‘manufactured goods classified chiefly by material’ by 2.0%.

- Terms of trade reached in total the positive value of 102.3% in 2007 (in the year 2006 reached 98.5%). However, their level during the year 2007 gradually decreased - in Q1 103.7%, in Q4 only 100.3%.
Month-on-month comparison:

- The world prices of industrial raw materials and food covered by the index increased by 5.5% in January (-1.5% in December) and after a monthly pause they grew again. The main reasons were increases in Brent oil and natural gas prices by 5.7% (-1.1% in December) and in prices of food by 8.4%. Prices of metals and textile raw materials grew too. Prices of leather and wood decreased.
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Year-on-year comparison:

- In January, the world prices increased by 39.3% (+23.2% in December) and reached again above a thirty-percent growth after seventeen months. The main reason were increases in Brent oil prices by 67.5% and food prices by 30.6%. Prices of metals, leather and wood decreased.

1) The world prices follow current prices in original currencies in commodity markets and indicate in advance the character of the future development of the Czech import and export prices of industrial raw materials and food.

Analysis - Development of external trade price indices in the fourth quarter of 2007 and over the year 2007

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Note
Contact: Vladimír Klimeš, phone (+420) 274 054 102, e-mail: vladimir.klimes@csu.gov.cz
Data source: CZSO survey
End of data collection: Last calendar day of the month
End of data processing: Import and export price indices: 40th calendar day following the end of reference month
CZSO world price indices: 10th calendar day following the end of reference month
Related publications: 7201-07 Import and Export Price Indices in the Czech Republic
Detailed (Internet: /produkty/export-and-import-price-indices-in-the-cr-december-60nxkfuf2e )
7202-08 CZSO World Price Indices of Industrial Raw Materials and Food
Detailed (Internet: /produkty/indexy-csu-svetovych-cen-prumyslovych-surovin-a-potravin-prosinec-z8ictqx7yq )
The data released are final.