Canada Producer Prices Rebound in July

Canada’s Industrial Product Price Index rose 0.6% month-over-month in July 2026, rebounding from a 1.4% decline in June and exceeding forecasts for a 0.4% drop. The increase was driven by higher energy and petroleum product prices, which rose 6.4% as the resumption of the US-Iran conflict in July added to supply concerns. Refined petroleum energy products climbed 6.9%, led by diesel fuel (+10.4%) and finished motor gasoline (+4.7%). Crude oil shipments through the Strait of Hormuz briefly recovered in early July, pushing crude prices lower during the period. Offsetting some of the increase, primary non-ferrous metal prices fell 5.2%, driven by lower prices for unwrought gold, silver and platinum group metals (-6.9%) and unwrought aluminum and aluminum alloys (-7.0%). Prices for chemicals and chemical products declined 3.4%, mainly due to a 10.8% drop in fertilizers, pesticides and other chemical products.

The industrial producer price index in Canada fell by 1.4% from the previous month in June of 2026, the sharpest decline since December of 2023, to erase part of the surge in producer prices since January. The brief restoration of energy supply from the Middle East after the memorandum of understanding between Iran and the US drove fuel prices to slide in the month. The energy and petroleum sector of the CPI slid by 9.1%. Meanwhile, prices also fell for non-ferrous metal products (-4.7%) and meat, fish, and dairy products (-0.2%). The Canadian IPPI surged by 13.6% annually, the highest since 2022, as fuel prices remained elevated despite the monthly pullback. Energy and petroleum prices were 36.8% higher, while those for chemical products were 18% up.

Producer prices in Canada increased 1.2% month-over-month in May 2026, a fifth consecutive monthly increase, but below a downwardly revised 1.6% in April and forecasts of 1.8%. Disruptions to shipping through the Strait of Hormuz continued to affect global commodity markets in May, reflecting impacts on crude oil costs and supply chains. This situation contributed to price increases across multiple commodity groups, including chemical and chemical products (7%), mostly plastic resins (33.1%); energy and petroleum products (2.5%), particularly motor gasoline (7.2%); and primary non-ferrous metal products (1.1%), mainly unwrought aluminum and aluminum alloys (3.5%). Excluding energy and petroleum products, producer prices increased 0.9%. Year-on-year, producer prices rose 13.6%, the most since June 2022, following an 11.1% rise in April. The largest contributions came from prices for unwrought silver and silver alloys (135.4%), diesel fuel (61%) and finished motor gasoline (47.9%).