Rising geopolitical tensions and disruptions to global oil flows pushed energy prices sharply higher in March, driving a broad increase in industrial costs while underlying price trends remained weak across much of the economy.
Industrial prices rose 2.4% in the month and were up 7.8% compared with a year earlier, with the increase concentrated in energy and petroleum products, which surged 27.4% in March.
The spike reflects higher prices for refined fuels and crude oil, as supply constraints tightened global markets and fed directly into production costs. Diesel and gasoline recorded strong gains, while crude energy products rose more than 40%, amplifying cost pressures across supply chains.
Outside the energy sector, price signals were weaker. Excluding energy and petroleum, industrial prices declined 0.5%, indicating limited pricing power across manufacturing industries.
Chemical products posted a 4.1% increase, supported by higher costs for plastic resins, petrochemicals and fertilizers, all closely tied to energy inputs. In contrast, prices for primary non-ferrous metals fell 1.7% for a second consecutive month, with declines in silver and platinum offsetting gains in aluminum. Food-related products, including meat and dairy, also edged lower.
On a yearly basis, industrial price growth remained elevated but uneven. Gains were driven largely by energy products and precious metals, with gold, silver and platinum group metals showing strong increases over the past year. At the same time, declines in softwood lumber and pork prices continued to weigh on overall growth.
Raw material costs rose more sharply than finished goods, increasing 12.0% in March. The rise was again driven by energy, as crude energy products climbed 41.1%, marking one of the strongest monthly increases in recent years.
Excluding crude energy, raw material prices increased only 0.2%, reinforcing that most of the pressure remains concentrated in a narrow set of commodities rather than across the full production base.
Cost pressures are beginning to extend into agriculture. Crop prices rose 3.9% in March, led by gains in canola, wheat and other grains, as higher energy prices pushed up fertilizer costs and input expenses.
Metal ores and concentrates declined 0.9%, reflecting softer prices for gold and silver following earlier peaks, while other commodity groups showed mixed performance.
On an annual basis, raw material prices increased 23.6%, with energy and metal ores accounting for most of the rise. Declines in certain crop categories partially offset the increase but did little to change the overall trend.
The March data highlights a narrow and externally driven source of price growth. Energy continues to dominate both industrial and raw material price movements, while most sectors show limited or declining momentum, raising questions about the durability of broader price pressures in the absence of sustained commodity shocks.
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