Producer and Retail Price Indices

Published 16 February 17

The Producer Price Index (PPI) measures changes in the prices of goods sold by UK based manufacturers in the form of an index. It is therefore useful as an indicator of movements in factory-gate* prices of manufactured products.

A PPI is available for manufactured liquid milk and cheese and curd.

The Retail Price Index (RPI) measures changes in the prices of goods sold by retailers (or prices paid by consumers). RPIs for fresh milk and cheese are reported here.

Using the PPI together with the Retail Price Indices (RPI) provides some insight into the relative rate of change in prices of goods sold at different parts of the supply chain.

PPI – Dairy

The latest estimates from ONS show a substantial 6.8% increase in prices received by manufacturers of liquid milk between January 2017 and December 2016. However, prices remain 6.6% lower than a year earlier. 

Factory-gate prices for cheese & curd also increased in January, up 2.2% compared to December 2016. With rises recorded most months since August 2016, cheese & curd prices are 6.3% higher this year than January 2016. 

 Percentage change in output prices for manufactured dairy products (2010=100)

  

Manufactured liquid milk

Cheese & curd

  

1 month

12 months

1 month

12 months

 2015

Nov

2.6

-5.0

-0.1

-8.1

 

Dec

-1.6

-5.3

-0.1

-7.3

 2016

Jan

-0.4

-3.9

-1.3

-6.3

 

Feb

3.4

1.5

1.5

-4.3

 

Mar

-0.5

1.4

-0.8

-3.0

 

Apr

0.0

1.8

-0.3

-3.2

 

May

-2.6

-3.2

-0.5

-2.5

 

Jun

-5.8

-8.2

-0.1

-2.5

 

Jul

-3.5

-10.9

-0.3

-2.6

 

Aug

-0.7

-11.5

+0.7

-1.9

 

Sep

-3.6

-15.1

+0.8

-0.9

 

Oct

+0.2

-12.2

+2.2

+1.7

 

Nov

+0.0

-14.4

+1.0

+2.8

 

Dec

+0.1

-12.9

-0.2

+2.7

2017 Jan +6.8 -6.6 +2.2 +6.3

 Source: Office for National Statistics

 PPI Dairy

Source: Office for National Statistics

*The ONS definition of the ‘factory-gate’ price is “the price of goods sold by UK manufacturers and is the actual cost of manufacturing goods before any additional charges are added, which would give a profit. It includes costs such as labour, raw materials and energy, as well as interest on loans, site or building maintenance, or rent.” The ‘factory-gate price is a measure of the price of goods before they reach the distribution or retail sector.

The PPIs are calculated using data supplied from individual UK manufacturers, importers and exporters. A full explanation of how the PPI is calculated can be obtained from the ONS through this link.

 

RPI – Dairy

According to the most recent data, retail prices for fresh milk fell slightly between January 2017and December 2016 (0.8%). Retail cheese prices rose however, rising 1.2% over the same period. 

For fresh milk, retail selling prices in Janaury were 0.8% higher than a year earlier while retail prices for cheese were 0.6% lower than in January 2016. 

Percentage change in retail sales prices for dairy products (2010=100) 

  

Fresh milk

Cheese

  

1 month

12 months

1 month

12 months

 2015

Nov

-1.5

-8.7

+1.4

-4.9

 

Dec

+0.8

-8.2

+0.2

-3.9

2016 

Jan

-0.2

-4.8

-1.9

-5.9

 

Feb

+0.2

-3.3

+1.5

-0.8

 

Mar

-0.5

-4.9

-0.4

-3.3

 

Apr

+0.9

-3.8

-2.1

-4.7

 

May

-0.4

-4.2

+3.1

-0.5

 

Jun

+0.4

-3.3

-2.9

-5.8

 

Jul

+0.7

0.0

+2.0

-2.1

 

Aug

-0.1

-0.4

-1.6

-2.1

 

Sep

-0.6

-0.6

-1.9

-4.3

 

Oct

+0.2

-0.1

+2.1

-0.8

 

Nov

+0.2

+1.5

-1.7

-3.8

 

Dec

+0.6

+1.4

+1.2

-3.6

2017

Jan

-0.8

+0.8

+1.2

-0.6

Source: Office for National Statistics

RPI Dairy

Source: Office for National Statistics

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