The average price increase of manufactured products was 7.2 percent last year relative to 2007. This is the most substantial price increase in the span of 8 years. Industrial selling prices followed an unpredictable course.
Industrial selling prices and oil price
Extreme price fluctuations
Over the first nine months of 2008, prices of manufactured products were considerable, showing a 12 percent peak in July. Subsequently, the average price increase slowed down rapidly. In the last two months of 2008, selling prices were in fact going down. Manufactured products were more than 7 percent cheaper than one year ago, which is quite exceptional.
Last year, industrial selling prices varied considerably more than in previous years. Industrial selling prices are closely related to oil prices, which have recently been unstable. The chemical and petroleum processing and refining industries are relatively prominent in the Netherlands. The price of crude oil was much higher in 2008 than in 2007. The highest price was recorded in mid-2008, but in the last months of the year, oil prices plummeted.
Contribution to increase in industrial selling prices, 2008
Petroleum processing and refining industry contributes most
Higher prices for petroleum-related products accounted for two fifth of the overall price increase of 7.2 percent over 2008. Prices of chemical products and food and drinks each accounted for one fifth of the increase in industrial selling prices. The share of other branches in manufacturing industry was marginal.
Industrial selling prices by branch, 2008
Prices up in all branches
Across all branches of manufacturing industry, prices went up last year compared to 2007. In the petroleum processing and refining industry and the chemical industry, prices were raised by 21.5 and 8.9 percent respectively. Mid-2008, prices of petroleum products were nearly 50 percent higher than in the same period in 2007, but by the end of the year prices had dropped by 45 percent relative to twelve months ago. Prices of products in other branches were less unstable.
Karin van der Ven and Gerard Taal