Producer price inflation holds steady at 0.5% in April

South Africa’s annual producer price inflation (PPI) for final manufactured goods remained unchanged at 0.5% in April, matching the rate recorded in March, according to data released by Statistics South Africa on Thursday.

The PPI, a key indicator of inflationary pressures in the production sector, saw a month-on-month increase of 0.5% in April.

The primary driver of the annual PPI rate was the food products, beverages, and tobacco products category, which rose by 4.7%, contributing 1.4 percentage points to the headline figure. This category also led the monthly increase, with a 0.9% rise adding 0.3 percentage points to the overall index.

In the intermediate manufactured goods sector, the annual PPI surged to 8.5% in April from 7.4% in March, driven by a 13.2% increase in basic and fabricated metals, which contributed 6.6 percentage points. Chemicals, rubber, and plastic products also supported the annual rate, rising 4.2% and adding 1.2 percentage points. On a monthly basis, the index climbed 2.4%, with basic and fabricated metals again leading, up 4.2% and contributing 2.1 percentage points.

The PPI for electricity and water saw a notable annual increase of 11.2% in April, up from 10.0% in March, with the index rising 6.4% month-on-month. Electricity prices, up 12.5%, were the dominant contributor, adding 10.7 percentage points to the annual rate, while water prices rose 4.6%, contributing 0.7 percentage points. Monthly gains were led by electricity (7.3%, contributing 6.3 percentage points) and water (1.1%, contributing 0.2 percentage points).

In mining, the annual PPI eased to 4.1% in April from 5.9% in March, though the index rose 3.2% month-on-month. Key contributors to the annual rate included gold and other metal ores, up 21.7% and contributing 5.8 percentage points, followed by non-ferrous metal ores (2.9%, 1.5 points) and stone quarrying, clay, and diamonds (26.0%, 1.1 points). Monthly increases were driven by non-ferrous metal ores (3.7%, 1.8 points) and gold and other metal ores (4.9%, 1.5 points).

The agriculture, forestry, and fishing sector recorded a 4.4% annual PPI increase in April, up from 2.4% in March, with a 4.5% month-on-month rise. Agriculture was the main contributor, with a 4.7% increase adding 4.1 percentage points to both annual and monthly rates.

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