China's factory-gate inflation quickens on increased energy prices

BEIJING, Oct. 14 (Xinhua) -- China's producer price index (PPI), which measures costs for goods at the factory gate, rose 5 percent year on year in September, with the growth rate accelerating by 1.2 percentage points from August, official data showed on Wednesday.

This pace marked the fastest growth since June 2022. On a monthly basis, the PPI increased 1.2 percent, with the growth rate widening by 0.8 percentage points from the previous month, according to the National Bureau of Statistics (NBS).

The faster growth was mainly driven by rising international crude oil and non-ferrous metals prices, changes in supply and demand in certain energy and raw material industries, and growing demand from emerging sectors such as artificial intelligence (AI), NBS statistician Dong Lijuan said.

Prices in petroleum extraction, refined petroleum product manufacturing and organic chemical raw material manufacturing rose 14.5 percent, 7.4 percent and 5.4 percent, respectively, from the previous month.

Prices in non-ferrous metals mining and processing, and non-ferrous metals smelting and rolling, increased 1.6 percent and 1.5 percent, respectively. Together, these five industries contributed approximately 0.63 percentage points to the monthly PPI increase.

Changes in supply and demand in certain energy and raw material industries also drove prices higher. Coal mining and washing prices surged 9.5 percent month on month, while coal processing prices jumped 13.6 percent, amid increased coal stockpiling ahead of the winter heating season, temporary supply tightness in major coal-producing regions, and expectations of higher international coal prices.

Meanwhile, recovering demand for construction materials like steel and cement, coupled with rising raw material costs, lifted prices in related industries.

Accelerated development in AI and coordinated computing-power as well as electricity infrastructure also boosted demand and resulted in higher prices in certain manufacturing sectors.

Prices in both electrical machinery and equipment manufacturing, and computer, communications and other electronic equipment manufacturing, rose 0.4 percent month on month, together contributing roughly 0.07 percentage points to the PPI increase, the data revealed.

Wednesday's data also showed that China's consumer price index (CPI) rose 0.9 percent year on year in September on higher energy and industrial consumer goods prices.