The Industrial Product Price Index (IPPI) fell by 0.5 per cent on a monthly basis, marking its second consecutive decline. On a year-over-year basis, the index rose by 1.2 per cent — the eighth straight annual increase.
Meanwhile, the Raw Materials Price Index (RMPI) slipped 0.4 per cent in May. Compared with the same month last year, the index dropped 2.8 per cent.
The largest contributor to May’s decline in the IPPI was lumber and other wood products, which fell 6.0 per cent. It was the sharpest drop for the category since June 2022, largely driven by an 8.8 per cent decrease in softwood lumber prices. Slower demand, as buyers held back in anticipation of further price drops, contributed to the downturn.
Energy and petroleum products also moved lower, declining 1.9 per cent. Diesel fuel prices fell 4.8 per cent, reflecting lower costs for conventional crude oil. In contrast, gasoline prices rose 1.6 per cent as a result of seasonal demand and reduced supply due to temporary refinery issues in North America.
Meat, fish and dairy prices rose 1.2 per cent, continuing a six-month upward trend.
Prices for primary non-ferrous metal products rose 0.9 per cent, with unwrought gold, silver and platinum group metals climbing 1.6 per cent. Unwrought copper rebounded by 3.0 per cent after falling sharply in April, aided in part by easing trade tensions between the United States and China.
On a year-over-year basis, the strongest contributor to the IPPI increase was unwrought gold and gold alloys, which surged 41.7 per cent. Ongoing global trade uncertainty and geopolitical tensions continued to support strong demand for gold as a safe-haven asset.
Other notable annual increases included beef and veal prices, up 19.5 per cent, unwrought aluminum and aluminum alloys at 15.3 per cent, and silver products at 12.8 per cent.
However, several groups posted year-over-year declines, including finished motor gasoline (-10.2 per cent), diesel fuel (-5.9 per cent), and unwrought nickel and nickel alloys (-20.4 per cent).
The RMPI’s monthly decline was driven primarily by a 4.5 per cent drop in crude energy products. Conventional crude oil prices fell 4.3 per cent amid growing concerns of a global supply glut. OPEC+ announced increases to its June and July production targets, contributing to downward pressure on oil markets throughout May.
Prices for metal ores, concentrates and scrap rose 1.9 per cent, supported by a 2.4 per cent increase in precious metal ore prices. Crop product prices rose 1.1 per cent, led by a 6.2 per cent jump in canola due to tightening domestic supply and strong export demand.
Over the past year, the RMPI fell 2.8 per cent due to a 22.4 per cent decline in conventional crude oil and a 22.7 per cent drop in synthetic crude. Nickel ores also fell significantly, down 20.4 per cent from May 2024.