Manufacturing prices continue to fall

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© Roger Dohmen
Statistics Netherlands (CBS) reports that output prices of products manufactured in the Netherlands were 5.8 percent down in July 2016 from July 2015. Again, the price drop is less substantial than in the preceding month. If price developments in the petroleum industry are not taken into account, the price drop in July would have been 3.3 percent.

Lower crude oil and output prices

Year-on-year oil prices have fallen almost continuously since 2013. The price of a barrel of North Sea Brent oil was 42 euros in July, i.e. nearly 19 percent below the price level recorded in July 2015. In June, the barrel price exceeded 44 euros, 22 percent below the level recorded one year previously.
Year-on-year prices of petroleum derivatives slumped by 22.8 percent in July 2016 and by 21 percent in June 2016. Evidently, prices of petroleum derivatives are directly affected by crude oil price developments.
With nearly 14 percent, the price drop in the chemical industry was also above average. Prices of basic metal, rubber and plastic products and machinery were also down from twelve months previously, while prices of food products, metal products and prices in the automotive industry were higher than one year ago.

Selling prices manufacturing by sector
 % change
Food products1.1
Metal products0.8
Rubber and plastic-0.8
Basic metal products-1.8
Chemical products-13.6
Petroleum products-22.8

Altogether, the eight industries referred to in the above text and the corresponding graph account for 80 percent of total Dutch manufacturing industry.

Manufactured products less expensive in July than in June

Prices of manufactured products decreased on a month-on-month basis. In July 2016, output prices of manufactured products fell by an average of 0.5 percent, while prices rose in the preceding three months. Prices on the foreign market fell more rapidly than on the domestic market: 0.7 versus 0.3 percent. The crude oil price also decreased in July compared to June.