It is getting much more expensive to transport and store goods around the United States, a signal that the economy may not yet have hit the peak of inflation.
The government on Thursday released the Producer Price Indexes (PPI) for April showing that “final demand” prices for transportation and warehousing jumped 3.7 percent compared with a month earlier. Compared with a year ago, prices in the sector are up 20.8 percent.
The skyrocketing prices for transportation also call into question the effectiveness of the policies of President Joe Biden and Secretary of Transportation Pete Buttigieg. President Biden said on Tuesday that fighting inflation was his top priority.
The PPIs contain data on prices for the full set of goods and services produced in the U.S.—including prices charged by businesses to other businesses, foreign customers, and government agencies—while the more familiar Consumer Price Index covers only prices paid by the U.S. household sector.
The data include information on “final demand” prices, which are sold the end-users of products and services, including households, businesses, government, and capital investment. They also include prices for different stages of “intermediate demand,” which track production through the supply chain.
Transportation costs are up no matter how things are shipped. Rail freight prices rose 2.6 percent in April and are up 9.7 percent from a year ago. Truck transportation prices jumped 5.1 percent in March and 4.4 percent in April. Compared with a year ago, they are up 27.4 percent. Prices for air freight rose 3.5 percent in April for a 12-month gain of 12.8. Shipping by waterways jumped 5.7 percent for an annual rise of 21.2 percent.
Truck trailer prices have skyrocketed. These rose 2.6 percent in April are are up 39.9 percent for the year. Diesel fuel prices rose 8.1 percent in April and are up a jaw-dropping 81.6 percent from a year ago.
Warehousing prices for goods jumped 4,5 percent in April and they are up 15.1 percent since the month a year prior.
The price hikes are similar throughout the chain of production and to all sorts of users. Prices of transportation and warehousing of goods for personal consumption rose 3.9 percent in April and are up 23.3 percent for the year. Capital goods transportation and warehousing prices climbed 4.2 percent month-to-month and 24.9 percent over the previous 12 months.