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Archive of methodological explanations for the news release:


Industrial producer price indices on the domestic market


Status: 22.02.2013


Goals
The industrial producer price indices measure the changes of the industrial producer price levels of the industrial products produced in Macedonia and sold on the domestic market.

Classifications and data publishing
The industrial producer prices are collected and processed according to the National Nomenclature of Industrial Products (NNIP/2008), and the indices are calculated at the level of groups, divisions and sections of the National Classification of Activities (NKD Rev.2).

The industrial producer price indices on the domestic market are published by sections and divisions.

The indices cover the following sections:
- B (Mining and quarrying),
- C (Manufacturing),
- D (Electricity, gas, steam and air conditioning supply).

The indices cover the following divisions:
- from section B, divisions 05 (Mining of coal and lignite) and 08 (Other mining and quarrying),
- from section C, all divisions except division 26 (Manufacture of computer, electronic and optical products),
- from section D, only class 35.11 (Production of electricity).

Also published are indices which show the price dynamics according to the final use of the products, classified into 4 groups and 2 subgroups:
- energy,
- intermediate goods except energy,
- capital goods,
- consumer goods:
     - durable goods,
     - non-durable goods.

Data collection
The prices, which are a basis for calculation of the industrial producer price indices, are collected with the statistical questionnaire:
  • Monthly report on industrial producer prices on the domestic market (C.41doma).
The questionnaire C.41doma is mailed to the enterprises at the beginning of the year.
For each enterprise an individual statistical questionnaire (form) is prepared.
The questionnaires include only the representative products of selected enterprises.
Each selected product has a code with 10 digits from the NNIP/2008 and 2 digits for specification of the product, description of the product, unit of measurement, and explanation and detailed specification of the price changes.
The enterprises fill in data on prices as at the 15th of the current month, and send the completed forms to the SSO by mail, through the regional departments, not later than the 30th of the month.

With 2010 as a base year for the industrial producer price indices on the domestic market, the sample covers 246 enterprises with 695 specified industrial products.

Prices
The Industrial Producer Price
is the price at which the producer sells the products to the network of wholesale and retail distributors in the largest quantities, on the domestic market, loaded free on rail or truck where the producer is located, or it is the price based on which the producer deals with other producers in the sphere of trade.
This price includes producer subsidies, but deducts commercial rebates, discounts, cash discounts and similar reductions offered by the seller.
VAT and excises are also deducted from the price.

The prices in the base period are the basis for comparison of the prices in the current period.
The base price is the price from 2010 calculated as an arithmetic average of the monthly prices of the industrial products.

Weighting
For weighting, the turnover on the domestic market for each product of each reporting unit (at the lowest level, 10 digits from NNIP/2008 plus 2 digits of specification) is used.

The sources of data needed for weighting are:
  • Annual report on industry (IND.21) for 2010 and
  • Annual report of industrial producers on sold quantities and values on the domestic market (C.41god) for 2010.
The weights are changed every 5 years.

Calculations
(1) The monthly industrial producer price indices on the domestic market are calculated with the Laspeyres formula.



I/(t/o) - index at the level of division, section, main industrial group and total index
P(ti) - price of the product "i" in the current month
P (oi) - price of the product "i" in the base period
W(oi) - weight of the product "i" in the base period
n - number of products

The industrial producer price index on the domestic market, at different levels of the National Classification of Activities (total, by main industrial groups, sections, divisions), is calculated in two steps:
- in the first step, the individual indices of each product are calculated (at the lowest 10-digit level of the NNIP/2008, plus 2 digits of specification), for each individual price, as a ratio between the price of the current month and the base period price,
- in the second step, the individual indices of each product are compiled by weighting at a higher level (total, by main industrial groups, sections, divisions), while for the calculation of the weights, the turnover on the domestic market is used.

(2) Besides the monthly index as a basic one, the following indices are also calculated and published:
- current month index compared to the previous month index,
- current month index compared to the index for December of the previous year,
- current month index compared to the same month index of the previous year,
- average monthly index including current month compared to the same average index of the previous year.

(3) Aggregated industrial producer price indices on the domestic market according to NKD Rev.2 are also calculated:
- total index,
- indices for 4 main industrial groups and 2 subgroups,
- indices for 3 sections,
- indices for 26 divisions.

Publishing

Monthly:

- Release "Industrial producer price indices on the domestic market",
- Edition "Short-term statistics for the economic movements in Republic of Macedonia",
- Edition "Monthly statistical report",
- MAKStat databases.

Yearly:
- Statistical Yearbook of Republic of Macedonia.

Harmonization with EU regulations
The methodology for calculation of Industrial Producer Price Indices on the domestic market is harmonized with the "Methodology of short-term business statistics" by EUROSTAT, for the following variables:

- 311 Industrial Producer Price on the domestic market.
   


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