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Producer Price Index (PPI)

Regi onal Seminar on Developing a Program for the Implementation of the 2008 SNA and Supporting Statistics Yaşar Pınar ÖZMEN 11-13 September 2013 Ankara - Turkey.

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Producer Price Index (PPI)

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  1. Regional Seminar on Developing a Program for the Implementation of the 2008 SNA and Supporting Statistics Yaşar Pınar ÖZMEN11-13 September2013 Ankara - Turkey

  2. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Producer Price Index (PPI) • Definition • PPI History in Turkey • PPI Coverage • Coverage by Numbers • Classification • Data Sources • Sampling • PPI weights (2013) • Prices • Index Aggregation Formula • Reference Period • Laspeyres Aggregation • Annual Update System • Dissemination • PPI Uses in Turkey • Future Plans

  3. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Definition Producer Price Index (PPI), measures the average change over time in the selling prices received by domestic producers for their output. PPI for Turkey, measures the average change over time in the selling prices in domestic market,received by domestic producers for their output. “PPI for Domestic Sales” PPI for non-domestic sales is work in progress.

  4. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey PPI History in Turkey PPI for the first time was published at the beginning of 2005 as the base year 2003. Wholesale Price Index (WPI) as the base year 1981, 1987 and 1994 had been calculated before 2005. The main difference between PPI and WPI is about taxes and product coverage. PPI excludes taxes on products while WPI includes. Producer prices are collected from producer enterprises, wholesale prices are from traders so it also includes imported products.

  5. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey PPI Coverage Geographical coverage: All country Sector / product coverage: A- Agriculture, hunting and forestry B- Fishing C- Mining and stone quarrying D- Manufacturing industry E- Electricity, gas and water.

  6. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Coverage Information by Numbers A total of 788 products are covered in 2013.

  7. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Classification Index structure is based upon: • Statistical Classification of Economic Activities in the European Community (NACE) • Statistical Classification of Products by Activity in the European Economic Community (CPA) • PRODCOM list (ProdTR)

  8. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Data Sources Sectoral weights are based on production values in National Accounts. Sampling and weights of products and enterprises are derived from the following surveys: Industrial Production and Turnover data Annual Industrial Products (Prodcom) Statistics

  9. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Sampling According to sales value in a product group, enterprises dominate at least 80% of the market are sampled. Judgemental sampling is used for some large groups. Product/transaction selection is made by the reporting enterprise.

  10. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey PPI Weights (2013) Sectors Weights Agriculture16.34 Agriculture, forestry 16.01 Fishing 0.33 Industry83.66 Mining and quarrying 3.06 Manufacturing 72.14 Electricity, gas and water 8.46 ToplamTotal 100.00

  11. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Prices Timing for price observation is the average of 5th-15th-25th day and in some cases average prices of the reference month. Prices in agriculture are selling prices of farmers to the marketing channels in each month between 1-25 days. Prices exclude product taxes (e.i. VAT, excise duties), trade and wholesale margins, transport charges invoiced separately.

  12. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Index Aggregation Formula Lowest level indices: Weighted arithmetic average of price relatives. Index Formula: Chained Laspeyres Weights and coverage are updated every year. I0:t : index of current month I0:t-1 : the last index (Dec.) of ref. year Idec(t-1):t(m): Dec (t-1)=100 index of current month i : index level (product, class, etc.)

  13. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Reference Period Index reference year: 2003 Weight reference period : y-2  December of y-1 (e.g. 2010 for 2012) Price reference period : December of y-1 (e.g. December of 2011 for 2012)

  14. Current price (Pt) (monthly price for the year y) Laspeyres Aggregation Weights of enterprises y-2 Weights of products (Prodcom) y-2 Prices updated from y-2 to December (y-1) Base price (P0) Dec. (y-1) Weight (W) Dec. (y-1) Weights of NACE classes y-2 Elementary aggr. Weights of NACE sections and groups 14/30

  15. Annual Update System Prodcom data for product/enterprise coverage and weights Defining new producers and products, and updating the current coveregae Sending questionnairres to Regional Offices (RO) Industrial Production data for enterprise coverage and weights Weights of NACE Sectors and Groups from National Accounts PPI Collecting product informations from enterprises Introducing new items to the index and data entry program Weights from administritive records or other statistics (electricity, gas,water, oil etc.) RO send checked questionnaires to the TurkStat centre for data editing 15/30

  16. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Dissemination • Results of the PPI are announced to the public in the 3rd day or consequent working day of the month at 10:00 with a news bulletin. • The data are disseminated simultaneously to all interested parties through a database and news bulletin. http://www.tuik.gov.tr/PreTablo.do?alt_id=1076

  17. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey PPI Uses in Turkey • Estimation of inflation (CPI) • Deflator • Rental aggrements • Revaluation rates • Determination of some tax rates • Updating procurement of value contracts • Other escalation procedures

  18. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Plans • For 2014 Adoption of NACE Rev.2 and backcasting New base year Non-Domestic PPI calculation Domestic & Non-Domestic Total PPI • For 2015 PPI for services (SPPI) • For long-term PPI for construction

  19. Regional Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics11-13 September 2013 / Ankara – Turkey National Seminar on Developing A Program for the Implementationof the2008 SNA and Supporting Statistics in Turkey 10 September 2013 / Ankara - Turkey Thank you for your attention

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