Industry prices fell 0.84% between September and October. Prices are measured by the Producer Price Index (IPP), which recorded the first decline since July 2017. The index accumulated 13.04% in the year and 15.12% in comparison with October 2017. The data were released today (28), by the Brazilian Institute of Geography and Statistics (IBGE).
According to the IBGE, the reduction in the prices of the industry was driven by the derivatives of soybean oil, meat and orange juice, which in turn were impacted by the devaluation of the dollar.
“Both the bran and other residual products from the extraction of soybean oil, as well as frozen meats and concentrated orange juices, are mainly destined for export,” explained the manager of Analysis and Methodology of IBGE, Alexandre Brandão.
Fresh and chilled beef, which also weighed on the downside of the indicator, has its biggest outlet for the domestic market, and in October, there was a greater supply for the slaughterhouses. “In this case, the contraction of households’ purchasing power helps explain the fall in domestic demand,” completes Brandão.
The IPP measures the variation of the prices of products at the “factory gate”, free of taxes and freight, from 24 activities in the extractive and manufacturing industries.
This text was translated by machine from Brazilian Portuguese.