COMMENTARY
IMPORT PRICE INDEX
The rise in petroleum prices drove the rise in the Import Price Index for March quarter 2017.
Mineral fuels, lubricants and related materials rose 9.2% driven by Petroleum, petroleum products and related materials (+9.7%). Through the year, Petroleum, petroleum products and related materials rose 40.4%, the largest annual growth since September quarter 2008.
Chemicals and related products, n.e.s. rose 1.9%. Fertilizers (excluding crude) (+14.2%) drove the rise, as prices recovered after five quarters of sustained falls.
Offsetting these rises were small falls, predominately driven by the exchange rate.
Machinery and transport equipment fell 0.9% driven by Road vehicles (-1.0%), impacted by the appreciation of the Australian dollar relative to the Euro and the Yen.
Commodities and transactions, n.e.s. fell 1.0%. Gold, non-monetary fell 1.0%, as gold prices continued their modest decline following the December quarter 2016.
MAJOR IMPORT PRODUCTS
The price movements of Australia's major import products are summarised below:
- Road vehicles (SITC 78) (-1.0%);
- Petroleum, petroleum products and related materials (SITC 33) (+9.7%);
- General industrial machinery and equipment, n.e.s. (SITC 74) (-1.1%);
- Telecommunications and sound recording equipment and reproducing apparatus and equipment (SITC 76) (-1.9%);
- Electrical machinery, apparatus and appliances, n.e.s. (SITC 77) (+1.0%)
EXPORT PRICE INDEX
Global demand for Australia's mining commodities in the March quarter 2017 was reflected in the higher prices received by exporters for a range of products.
Crude materials, inedible, except fuels rose 17.1%. Metalliferous ores and metal scrap rose 18.8%, driven by rises in the prices paid for Iron, Alumina and Copper ores. Prices received by exporters had been falling since June quarter 2014, but this trend reversed in 2016 with price rises recorded for the past four quarters. Through the year, prices for Metalliferous ores and metal scrap rose 51.3%, the largest annual growth since March quarter 2011.
Mineral fuels, lubricants, and related materials rose 11.0%. Prices for Coal, coke and briquettes (+12.8%) and Petroleum, petroleum products and related materials (+13.1%) drove the rise. Through the year, Coal, coke and briquettes rose 85.5% (the largest annual growth since March quarter 2009) and Petroleum, petroleum products and related materials rose 48.5% (the largest annual growth since June quarter 2008).
Offsetting these rises were falls in the agricultural sector.
Food and live animals fell 0.4%. Meat and meat preparations fell 2.3% driven by lower beef prices due to strong global supply.
MAJOR EXPORT PRODUCTS
The price movements of Australia's major export products are summarised below:
- Metalliferous ores and metal scrap (SITC 28) (+18.8%);
- Coal, coke and briquettes (SITC 32) (+12.8%);
- Gold, non-monetary (SITC 97) (-0.9%);
- Meat and meat preparations (SITC 01) (-2.3%);
- Gas, natural and manufactured (SITC 34) (+3.3%)
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