Export prices increased by 0.7% compared to the 2nd quarter of 2023, decreased by 4.4% year-on-year – Development of export and import price indices of goods – 3rd quarter of 2023

10/11/2023

Development of export and import price indices of goods in the 3rd quarter of 2023

Export prices increased by 0.7% in Q3 2023 versus Q2 2023, and decreased by 4.4% year-on-year in Q3 2023. Import prices increased by 1.3% in Q3 2023 versus Q2 2023, and decreased by 11.2% year-on-year in Q3 2023. Exchange sessions reached Q3 2023 vs Q2 2023 values ​​of 99.4%, year-on-year values ​​of 107.7% in the 3rd quarter of 2023.

Quarterly (in Q3 2023 vs Q2 2023) increased by 0.7%. Prices of machinery and means of transport grew the most by 2.1%, industrial consumer goods by 1.9% and prices of mineral fuels by 1.2%. The prices of other raw materials fell in particular[1]by 7.9% (mainly cork and wood), chemicals by 2.2% (mainly organic chemicals) and prices of semi-finished products[2] by 1.0%.

Interannually in the 3rd quarter of 2023 decreased by 4.4% (in Q2 2023 by 1.8%). Prices of other raw materials fell the most by 23.0% (mainly cork and wood), mineral fuels by 18.8% (electricity, petroleum products and coal) and chemicals by 13.4% (especially organic chemicals and plastics). The prices of beverages grew the most by 14.7% and the prices of machinery and means of transport by 1.5%.

Quarterly (in Q3 2023 versus Q2 2023) grew by 1.3%. The prices of mineral fuels rose by 6.2% (primarily oil and petroleum products), food by 2.0% and the prices of industrial consumer goods and machinery and means of transport by 1.7%. The prices of other raw materials fell by 4.4% (most significantly metal ores and metal waste), chemicals by 0.9% and prices of semi-finished products by 0.5%.

Interannually in Q3 2023 they decreased by 11.2% (in Q2 2023 they decreased by 7.6%). The prices of mineral fuels fell the most by 44.7% (mainly gas and electricity), other raw materials by 17.2% (mainly metal ores and metal waste) and chemicals by 12.0% (especially plastics). The prices of beverages and tobacco rose by 20.9% (tobacco the most), industrial consumer goods by 3.8% and food prices by 3.1%.

Quarterly (in the 3rd quarter of 2023 against the 2nd quarter of 2023) reached 99.4%. The lowest negative value was achieved by mineral fuel (95.2%). Machinery and means of transport recorded the highest positive value (100.4%).

Interannually in the 3rd quarter of 2023 they increased to a value of 107.7% (in the 2nd quarter of 2023 the value was 106.3%) and remained in positive values ​​in the third quarter – see graph 2. The highest positive value was recorded by mineral fuels (146.8%) and the lowest negative values ​​were achieved by food (91.8%).

The development of export and import prices was also significantly influenced by the exchange rate of the koruna against the main foreign currencies. To of the inter-quarterly index of the exchange rate of foreign currencies all monitored foreign currencies were included. The inter-quarterly indices of the CZK exchange rates to these currencies were weighted by their proportional representation, which belongs to these foreign currencies in the export price index, or of import prices (until the 2nd quarter of 2023, only the two most important currencies, i.e. EUR and USD, were included; from the 3rd quarter of 2023, the calculation was refined by including all currencies and counted back to 2021).

It can be seen from the above graphs 3 and 4 that, in the case of exports and imports, the prices of foreign trade in goods are linked to exchange rate effects. Contracts with foreign entities are usually concluded for longer periods of time, and the longer the contract period, the stronger the link to exchange rates.

The CZSO also calculates year-on-year price indexes of foreign trade in goods adjusted for exchange rate effects. The procedure is such that the prices in foreign currencies reported for the current month are recalculated to Czech crowns course the same month last year. Together with the prices reported in CZK, they enter the calculation of the weighted average. This exchange rate-adjusted basic price index is related to the unadjusted basic price index of the same month last year, thus the monthly year-on-year adjusted price index is calculated.

From 2017, quarterly adjusted indices are also calculated analogously. Differences between adjusted and unadjusted price indices can be significantare clearly visible from graphs 6 and 7, for example in the first quarter of 2018 or in the second quarter of 2021.

The method used does not allow for 100% exchange rate adjustment, because not all realizations in foreign currencies are also reported in foreign currencies; this share does not exceed 30%. It follows from the above that atfull exchange rate clearingwould with differences between published price indices and exchange rate-adjusted price indices probably further were increasing.

From the exchange rate-adjusted indices described above, an exchange rate-adjusted breakdown of price index increments can also be created. Table 1 shows published and exchange rate-adjusted breakdown of increments export and import price indices, with the expansion of the most significant two-digit groups of SITC 7. This breakdown illustrates well how many percentage points each group “contributed” to the index.

In general, the exchange rate effect lowers the price indices of foreign trade in goods, if the koruna strengthens in total against foreign currencies. On the contrary, the exchange rate effect increases price indices if the koruna weakens in total against foreign currencies.

Graph 5 shows the exchange rate of the koruna against the two most important foreign currencies, i.e. EUR and USD.

The following graphs 6 and 7 show how significantly the exchange rate effect of all monitored foreign currencies affected the level of export and import price indices.

Chart 8 illustrates the effect of the exchange rate on interannual exchange rates.

Graph 9 shows the development of the value of exchange relations when the group of mineral fuels is excluded from monitoring. In this graph, we can observe the influence of mineral fuels, which affects the total value of the interannual exchange rates. From Q1 2021, Mineral Fuels decreased the value of trade terms, but in Q1 2023 there was a reversal and Mineral Fuels began to increase the value of trade terms. It is, of course, related to the development of prices on world markets, especially oil. Import prices, which have a higher proportion of raw materials compared to export prices, react more sensitively to price turbulence, therefore, as a rule, trade terms increase when raw material prices fall, and vice versa, when raw material prices rise, trade terms fall.

Exchange rate influence interannually in the 3rd quarter of 2023, the export and import price index decreased. Import prices fell more than export prices, hence the terms of trade interannually reached positive values. Exchange rates excluding exchange rate effects reached a lower value than published exchange rates. Values ​​without exchange rate influence correspond to exchange rate-adjusted indices – see graphs 6, 7 and 8.

The final table lists the published uncleanedprice indices of export and import of goods.

Edited by: Ing. Vladimír Klimeš, department of price statistics

tel. 274 054 102, e-mail: [email protected]