National Institute of Statistics (Istat)

Directorate for Business Statistics (DCSE)

Division for Statistics on Production and Foreign Trade (SEB)

Via Tuscolana, 1788

00173 Rome Italy

Producer Price Index measures the average producer price development of industrial products sold on both domestic and non- domestic markets, at the initial stage of commercialization. The purpose of this index is to provide information on price dynamics over the business cycle.

It is also used in National Accounts as a deflator and for updating contracts in the private sector.

NACE Rev. 2.
For dissemination it is also used the MIGs breakdown (Main Industrial Groupings)

Activities covered: NACE Rev. 2 Sections B to E36 are covered by the output prices data. Indexes are not required for the following Groups or Classes of NACE Rev. 2: 07.21, 24.46, 25.4, 30.1, 30.3, 30.4 and 38.3.
Size classes covered: all enterprises

List and definition of variables: the list of products comprises approximately one-thousand items (PRODCOM). Prices, consisting of around ten thousand price series, are collected from a list of 6583 enterprises.

Planned changes in information collected: none

Accounting conventions: data are collected for products manufactured and sold on both the domestic and non-domestic market. Reporting units are the industrial enterprises. By definition, prices are effective transaction prices surveyed on the day the orders are made (collected prices are registered at the moment of contract). Prices are ex-factory or warehouse, excluding taxes (VAT), customs duties or subsidies. Other sale conditions are defined by the most common contracts.

Reporting unit: Industrial enterprise.
Observation unit(s): Manufactured industrial enterprise's producer price

Target population corresponds to all enterprises of Section B to E36 of NACE.Rev2.
Total number of enterprises is about 390.000 enterprises

Whole national territory

The indicator has been available since 1981. Data have been disseminated according to the NACE 2 classification at four-digit level since January 2000.

The base period is the month of December of the preceding year. The reference base is obtained by chain-linking. Since January 2024, the reference base is the year 2021. Before January 2024, all indices were re-scaled to the reference base 2021.

Indices

Month

Legal basis:

National level: this survey is one of the compulsory surveys fixed every year by a Decree of the President of the Republic (D.P.R.). European level:

Regulation (EU) 2019/2152 of the European Parliament and of the Council of 27 November 2019 on European business statistics, repealing 10 legal acts in the field of business statistics;

Commission Implementing Regulation 2020/1197 laying down technical specifications and arrangements pursuant to Regulation (EU) 2019/2152 (General Implementing Act);

Obligation on units to provide data: the surveys are mandatory. Penalties are foreseen for non-response.

Planned changes in legal basis, obligation to respond and frame used: None

This indicator is part of the official data shown at page https://www.istat.it/nsdp/ and correspond to the data described on the International Monetary Fund's Dissemination Standards Bulletin Board (DSBB). An explanation of the DSBB and the statistical standards to which Italy has committed are published on http://dsbb.imf.org/.

The data are transmitted to Eurostat on a monthly basis and are available at http://ec.europa.eu/eurostat/data/database

Several national legal acts guarantee the confidentiality of data requested for statistical purposes. According to art. 9, paragraph 1 of the Legislative Decree n. 322 of 1989, personal data can only be disseminated in aggregate form, in order to make it impossible to identify individuals. The Personal Data Protection Code - introduced by the Legislative Decree No. 196 of 30 June 2003 - and Legislative Decree No. 101 of 10 September 2018 (General Data Protection Regulation) provides special rules concerning the processing of personal data for statistical purposes within the National Statistical System (Sistan). Furthermore, in order to make statistical confidentiality and protection of personal data effective, Istat is currently taking appropriate organizational, logistical, methodological and statistical measures in accordance with internationally established standards.

Links to relevant legal acts on statistics are also listed on the website of Sistan (https://www.sistan.it/).

Survey elementary data are treated as confidential. Aggregated data are disseminated in IstatData

Some variables can be transmitted to Eurostat as confidential data when they are not disseminated in Italy.

Every year, in December, Istat publishes a release calendar providing the precise release dates for the coming year. The calendar is distributed to the press and is available free of charge to interested parties.

The release calendar is disseminated on ISTAT's website: Release calendar

Data are released simultaneously to all interested parties by issuing the press release "Prezzi alla produzione dell'industria e delle costruzioni". Eurostat receives embargoed data in advance of its publishing date. There is no pre-release access. The press release (Italian version and short English version) is subsequently posted on Istat's website (https://www.istat.it/en/prices).

Data are also sent to Eurostat according to the required standards by EDAMIS using SDMX format. Data are transmitted once per month: provisional data for month t-1 and final data for month t-2.

The short-term information is also used for quarterly and annual National Accounts.

Monthly

A monthly press release "Prezzi alla produzione dell'industria delle e costruzioni" including breakdown for domestic, non-domestic and total market (Prices/Archive).

Indices are published in the "Annuario Statistico Italiano" (ASI) -Italian Statistical Yearbook - Chapter 16 Annuario Statistico Italiano/Prezzi

The data are disseminated  in IstatData, a theme of the database "Prices", dataset “Industrial producer prices  - (base 2021).” IstatData’s online database is open and free of charge, the statistics are organized by categories and themes. The data are presented in aggregate form in multidimensional tables. By acting on variables, reference periods and the arrangement of heads and sides, users can create custom tables and charts. Data sets can be searched by keyword, theme and region. The platform uses the open-source tools "Data Browser" and "Meta & Data Manager" developed by Istat (https://sdmxistattoolkit.github.io) following the international standard SDMX (Statistical Data and Metadata exchange) for the exchange and sharing of statistical data and metadata.

 More information is available in the User Guide.

Before data dissemination, validated microdata are stored in the repository of the Institute, ARMIDA.

The ARMIDA repository (Archive of validated microdata) was established with the main objective of preserving and documenting the data produced by Istat surveys, and has subsequently supported the objective of disseminating data. The data archived in ARMIDA, in fact, supply the different channels for the dissemination of microdata (for internal use at the Institute through the "Memorandum of access to microdata of ARMIDA "internal users", for authorities in Sistan, for research files, for standard files, etc.).

This index is also one of the 'Principal European Economic Indicators (PEEIs)" https://ec.europa.eu/eurostat/web/euro- indicators

The series of the updated final indices are also published on Istat's web database, Rivaluta, which stores price indices, consumer prices, producer prices and construction costs indices. This software is aimed at certifying price indices’ rates of change over a period of time selected by users.

Data are sent to Eurostat according to required standards by EDAMIS using SDMX format. Eurostat receives embargoed data in advance of its publishing date.

A short description of the methodology and characteristics of the survey is contained in the technical explanatory note attached to the press release updated regularly.

A more detailed description of the methodology and sources used in preparing statistics is contained in the Information System for Survey Documentation and Quality Control (Siqual) which is available on Istat's website: SIQUAL. This system manages qualitative information related to every single phase of a survey's production process (Process description).

More information about procedures applied for quality management and quality assessment can be found in the document "Quality Guidelines For Statistical Processes" - December 2012

Quality Guidelines for statistical Process - December 2012

The quality assurance framework is based on the contents of the document "Quality Guidelines For Statistical Processes" - Istat - December 2012 (Quality guidelines for statistical process.)

Istat reference framework for quality policies relies on the European Statistics Code of Practice, adopted in 2005 (last revised in 2017), on the Eurostat Quality Definition and on the recommendations of the LEG on Quality. The Data Quality Assessment Framework, developed by the International Monetary Fund, also represents an important reference. Following the principles of the European Statistics Code of Practice, Italy has adopted the Italian Code of Official Statistics in order to promote quality improvements in the statistics produced by the Italian National Statistical System.

(Directive No 12/COMSTAT in Italian Official Journal No. 23, General Series of 29 January 2022). In accordance with Eurostat Quality Definition, the requirements of statistical products are:

• to be relevant with regard to users' information needs;
• to be accurate, that is to provide estimates or indicators that are as reliable as possible;
• to be timely catching the phenomena to be observed;
• to be easily accessible and supported by metadata allowing for a full understanding of the data;
• to enable comparisons over time or among different sources.

A description of methodology and sources used in preparing statistics is also contained in the Information SIqual/ Quarterly survey on producer prices

In 2010 this survey was submitted to an audit on quality in a testing phase

The main users of producer price index are:

• Institutions: government departments, ECB, national central bank, international organizations, etc.
• Social actors: employers' organizations, trade unions, lobby groups, etc.
• Media
• Researchers & students
• Enterprises/businesses
• Internal users
• Eurostat

Not available

Eurostat's requirements in terms of time series are fulfilled

Not applicable, it is not possible to compute sampling errors because a non-probability sampling method (cut-off) is used.

The response rate of the first estimate is  about 94% and of the definitive estimate is about 96%

Reminders are sent to non-respondents and follow-up operations are carried out.

All releases are delivered according to the timetable.

Not applicable, only national level.

Time series are available since January 2000.

Not available

The cost estimate is compiled in terms of total number of hours worked (THW), which is equal to the product of three terms: (total) Annual Working Days (AWD), (total) Hours Worked per Day (HWD), Number of Persons involved in the Survey (NPS).

The burden estimate is compiled in terms of the total number of minutes (TNM) taken to fill in the (web) questionnaire. The burden is applied to the respondent, i.e. the person who fills in the questionnaire on behalf of the enterprise. To estimate it, two elements have been taken into account. The first distinguishes between beginner and expert respondents, to point out respectively the person who fills in the web questionnaire for the first time and the one who is familiar with filling in the form. The second closely concerns the information that has to be monthly provided. On average, by combining these two elements, the time spent to fill in the questionnaire (just the burden) is estimated in terms of the total number of minutes ranging

between a minimum and a maximum threshold.

Monthly, provisional and final data are disseminated as indices. Data concerning the current month are provisional while data referring to the previous months are final.

Major  changes  in  methodology  are  announced  in  ad  hoc  publications.  Annually, the  base  period  is updated (Nota_Informativa_PPI_30 marzo 2023). Time series indices are available in the online database.

Advance notification of methodological changes is also provided through seminars and papers disseminated throughout the scientific community. The same revision policy is applied nationally and in transmissions to Eurostat.

At present, Producer price indices are not revised and seasonal adjusted. Data are firstly released as "provisional" (30 days after the end of the reference period) and subsequently as "final" (60 days after the end of the reference period). The distance between provisional and final data allows for an increase in the response rate, allowing revisions too (if any). The Mean Absolute Revision (MAR), Mean Revision (MR) and RMAR (Relative Mean Absolute Revision) are compiled for totals. These indicators refer to 36 monthly data from 2021 to 2023. The indicators refer to the Total market.

Monthly

Data validation is carried out on:

• Prices, by guided and checked data-entry procedures that prevent the incompleteness errors that could occur during the recording phases and to identify the outlier prices (filtering method);
• Trend of indices, by comparison between the percentage change on the previous month, the percentage change on the corresponding month of the previous year and a similar product index;
• Non-response data (prices) are estimated.

PPI are a system of Laspeyres chain-linked type indices. The indices compilation is carried out through three main steps:

1. firstly, by calculating price relatives, i.e. ratios between the surveyed price at the time (y,m) and that of the base period (the month of December of the preceding year) pointed out as (y,0) or (y-1,12);
2. price ratios are aggregated by simple geometric mean to derive the elementary product index;
3. Laspeyres indices are compiled by grouping product indices at class level (4-digit of the NACE Rev. 2) up to the overall index.

Adjustments for quality changes: when a price variation is due to a change in price-determining characteristics, a quality change occurs; the overlap algorithm is applied to link old and new price.

New price quotations are introduced only when the index base is updated

Seasonal items: the most recent price collected is held constant until new prices are reported for the same season.

Method of weighting and chaining: The weights system is defined at a national level. For the higher aggregation level (from the 4-digit level upwards) the weighting coefficients are determined on the basis of (billed) domestic sales of own-produced manufacturing products according to the Survey on "Enterprises Accounting Systems" (the main annual SBS survey). For lower levels, the PRODCOM survey is used. Seasonally adjusted indices are planned to be added to the raw indices.

Seasonally adjusted indices are not yet calculated