The source writes:
Concepts and definitions
- Statec (Luxembourg) compiles the industrial producer price index according to the "Producer Price Index Manual: Theory and Practice 2004 (ILO, IMF, OECD, UNECE, and World Bank)". As a Member state of the EU, it has also to follow the requirements of the ESS (European statistical system). In the case of the industrial producer price index, the Commission Regulations on short term statistics and on classifications as well as Eurostat's handbook on methodology of short-term business statistics (Interpretation and guidelines/Associated documents) have to be observed.
- The output price index shows the evolution of prices paid to the producer for goods sold on the domestic and export markets. The definition of output prices includes special taxes (partly), rebates and discounts and export subsidies. It excludes VAT, transport costs, custom duties and promotional prices. The basic series provide price indices for a representative sample of goods. Prices generally correspond to average order prices over the month.
- Products discarded are replaced by substitute products proposed by the enterprise. The operation is carried out by statistical chaining. The effect of quality changes on the price are taken into account as far as possible.
Scope of the data
- The survey's sample covers 113 production units KAUs in NACE Rev. 2. B to D for which 1,242 products, according to the Prodcom list and broken down by categories, are collected. Usually, the rate of response is almost 100%.
- The products making up the index are those of the PRODCOM list used in for the European Union mandated survey.
- The geographical area covered is the Grand-Duchy of Luxembourg, no regional results are produced.
- Prices normally refer to a specific date, but in practice most of the product prices are average monthly prices.
- The definition of the prices is that foreseen in the European commission regulation (CE) 588/2001 of 26 March 2001.
- The value data distinguishes between domestic and export markets at the product level. Export prices are provided by the enterprise either in euro or in a foreign currency. In the latter case prices are converted using the average exchange rate for the reference month.
- The industrial producer price index reflects the prices paid to the producer at factory gate (ex-factory prices) including net taxes on products (net of subsidies and rebates), but excluding VAT.
The monthly paper shuttle-questionnaires are usually sent by post to the units at the beginning of the month m+1. They must be returned to STATEC before the end of the month m+1. Preliminary results are available at m+ 2-3 weeks, validated revised results are published after m+ 6-7 weeks.
Source data collection programs
- All data are obtained by paper questionnaire, by e-mail, by fax or by phone from the units.
- The weights are the enterprises turnover in the base year splitted down by products and destinations of the sold production. The turnover comes from the structural business surveys.
- The weights are updated every five years when rebasing the PPI.
- The monitored products are regularly produced and sold products and must be representative for the range of products fabricated by the unit.
- The units selected are the most important industrial units in Luxembourg, the choice is carried out by judgement.
- The products for which prices are recorded are specified by description, destination, volume, units sold etc. Statec carries out personal visits in order to define the best practices together with the units.
Other statistical procedures
- The basic indices are weighted with the enterprise's turnover in the base year (index 100 in 2005). It corresponds to the turnover generated by sales of the enterprise's output excluding industrial services and products resold without further processing. The information is drawn from the census of industry.
- The monthly component indices for each product are determined by the ratio of that product price to the average price over the 12 months of 2005 (the base year). The weight given to each product corresponds to the ratio of the turnover from its sales to the turnover from sales of all industrial products during the base year.
- The weights are calculated according to a "gross sector approach", that is, transactions between two enterprises belonging to the same activity branch are taken into account.
- Indices at a 8, 4 and 3-digit level of NACE Rev. 2 are calculated for goods sold on the domestic and export markets. Further aggregates published (2-digit results and main industrial groupings) are produced in such a way as to guarantee confidentiality.
- The index is calculated using the Laspeyres formula, by applying a fixed-weighted arithmetic mean of component indices.
- Price series longer than eight years are normally not produced by Luxembourg, but however can be calculated using links.
- At this stage, Luxembourg does not seasonally adjust the indices because this adjustment is not prescribed by the Regulation (CE) on short term statistics.