Japan Wholesale Prices:

 https://mainichi.jp/english/articles/20210517/p2g/00m/0bu/026000c

Article:

TOKYO (Kyodo) -- Japan's wholesale prices climbed 3.6 percent in April from a year earlier, the sharpest increase in over six years, as oil and commodity prices rose in line with a recovery by the world economy from the coronavirus pandemic, the Bank of Japan said Monday.

The prices of goods traded between companies rose for the second straight month, posting the largest on-year gain since September 2014. They marked a revised 1.2 percent rise in March, the first increase in 13 months.

Ideas:

Wholesales prices rise and fall quarterly. The real challenge is how much of the prices increases or decreases are passed on the the customer.

If not regulated, its possible some wholesalers might decide to pass on all of the their costs to the customer or consumer, whether a business or a end consumer.

For example if there is a major heat wave in the summer and consumers use a lot of electricity, are the electric companies going to charge full amount or does government tell the electricity companies there is a cutoff that you can only charge so much.

The price increases of good traded among companies seems logical, especially among those in a manufacturing logistics chain, as the manufacturing industry is somewhat back to normal.

Article:

By item, prices for oil and coal products jumped 39.3 percent due to higher crude oil prices, reflecting a recovery from pandemic-hit levels a year earlier.

Nonferrous metal prices surged 35.2 percent due to strong demand in China, while prices for scrap metal soared 72.8 percent as demand for steel products in Japan and overseas also improved.

Ideas:

All of the commodities listed above most likely are all used in the manufacturing industry as manufacturing has recorded based on global demand for Japanese and Chinese products.

What is not mentioned, or maybe its part of the nonferrous metals, is the demand and prices of rare earth minerals, which are very important for the manufacturing of semiconductor chips for all kinds of 21st century products.

Article:

"Wholesale prices in Japan have been driven by a recovery of the overseas economy and influenced to a large degree by commodity prices," said a BOJ official.

Meanwhile, electricity, gas and water bills fell 8.1 percent from a year earlier.

Import prices rose 15.1 percent from the previous year while export prices gained 8.2 percent, both in yen terms.

Ideas:

Wholesale prices most likely are more related intermediate goods that are used in manufacturing, whether the intermediate goods are from Japan or abroad.

And of course as more there is more demand from overseas manufacturers need more intermediate products to meet the demand for example cars or laptop computers or whatever else in from Japan that is in demand.

And at the same time, manufacturing companies in China, whether Chinese or Japanese use a lot of intermediate goods produced in Japan.

Perhaps the reason for the decrease in electricity, gas, and water bills less consumer usage and or consumers cutting back to save money related to the uncertainty of jobs.

And or more people are going back to their offices and now are not at home as much as last spring and as such use less of the three.

The rise in imports prices good be many things beside the rise in oil prices globally

Part of the rise in import price is the increase in logistics and shipping and or the increase in prices due to more demand and as such suppliers see the opportunity to raise prices as they see an increase in demand.

And then there is the idea of the currency exchange rate which is increasing the prices of imports too.

Currency exchange rate increases or decrease can be both a positive and a negative.

For an exporter, they would prefer what is called a weak exchange rate as they get more for their products overseas.

While an importer would prefer the opposite. A week currency exchange rate means importers, those companies in Japan, have to pay more for the products they bring into Japan.

Have a nice day and be safe!