Import Prices Jump 0.5% Led by Fuel, Export Prices Flat but Ag Prices Down 1.4%

Import prices jumped 0.5% while export prices were flat. The inflation hawks will yap. So will Trump about soybeans.

The BLS provides this synopsis of Import and Export Prices for September.

Prices for U.S. imports increased 0.5 percent in September, the U.S. Bureau of Labor Statistics reported today, after declining 0.4 percent in August and 0.1 percent in July. The September advance was led by higher fuel prices. U.S. export prices recorded no change in September following declines of 0.2 percent and 0.5 percent the previous 2 months.

Imports

Import prices advanced 0.5 percent in September, the first monthly increase since a 0.9-percent rise in May. The upturn reversed the declines in each of the previous 2 months. Prices for overall imports rose 3.5 percent from September 2017 to September 2018 and have not recorded an over-the-year decrease since the index fell 0.2 percent in October 2016. (

Fuel Imports: The price index for import fuels increased 3.8 percent in September, after declining 2.2 percent in August. The September advance was the largest monthly rise since a 6.1-percent increase in May and was led by higher petroleum prices which more than offset lower natural gas prices. Prices for petroleum increased 4.1 percent in September following a 2.3-percent decline the previous month. In contrast, natural gas prices fell 4.0 percent, after decreasing 3.9 percent in August. Fuel prices increased 30.0 percent for the year ended in September, driven by a 32.1-percent advance in petroleum prices. The price index for natural gas fell 1.3 percent over the past 12 months.

All Imports Excluding Fuel: Prices for nonfuel imports recorded no change in September, after a 0.2- percent decline in August. Higher foods, feeds, and beverages prices in September offset decreasing prices for nonfuel industrial supplies and materials and consumer goods. The price index for nonfuel imports increased 0.6 percent over the past 12 months. The over-the-year advance was driven mostly by a 4.3- percent rise in nonfuel industrial supplies and materials, although higher prices for consumer goods and automotive vehicles also contributed to the increase. In contrast, prices for foods, feeds, and beverages fell over the same period and prices for capital goods recorded no change.

Export Prices M-O-M ans Y-O-Y

Exports

U.S. export prices recorded no change in September following declines in each of the previous 2 months. Those were the first monthly decreases since June 2017. In September, lower agricultural prices offset increasing nonagricultural prices. Despite decreasing over the past quarter, prices for U.S. exports advanced 2.7 percent for the year ended in September.

Agricultural Exports: Agricultural export prices fell 1.4 percent in September, after rising 0.3 percent in August and declining 5.2 percent in July. Overall, agricultural prices decreased 6.2 percent in the third quarter of 2018. The drop in agricultural prices in September and over the past 3 months was driven by lower soybean prices which fell 18.8 percent from June to September. The price index for agricultural exports decreased 2.3 percent over the past year. Declining prices for soybeans, fruits, meat, and nuts all contributed to the 12-month decrease.

All Exports Excluding Agriculture: Prices for nonagricultural exports rose 0.2 percent in September following a 0.2-percent decline the previous month. Higher prices for nonagricultural industrial supplies and materials; capital goods; automotive vehicles; and nonagricultural foods all contributed to the September advance in nonagricultural prices. The price index for nonagricultural exports increased 3.3 percent over the past 12 months and has not recorded an over-the-year decline since November 2016.

Econoday Comments

Year-on-year rates underscore the lack of imported price pressure, unchanged for capital good, up 0.1 percent for vehicles, and up 0.6 percent for consumer goods. Total year-on-year import prices, inflated by a 32 percent jump in petroleum, are up 3.5 percent. Without petroleum, import prices are up only 0.6 percent on the year.

By country of origin, import prices from China edged 0.1 percent lower for a third straight month with the yearly rate at plus 0.4 percent. Import prices from the European Union fell a monthly 0.2 percent with this yearly rate at plus 2.2 percent. In contrast, import prices from Canada and Mexico both show pressure, up 0.7 percent for Canada at a yearly 9.5 percent and up 0.9 percent for Mexico with this yearly rate, however, up only 0.5 percent.

The inflationistas will no doubt be howling again about inflation despite it being fuel-oriented.

Trump will howl over exports and China's tariff on soybeans.​

Mike "Mish" Shedlock

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