Producer prices in December 2024 +0.8% - Slight year-on-year inflation

Stable prices with differences. Energy prices drove producer prices down overall in 2024. However, capital and consumer goods recorded significant increases in some cases.
Wiesbaden, January 20, 2025 - Producer prices for industrial products in Germany rose by 0.8% in December 2024 compared to the same month in the previous year. Compared to the previous month of November, prices fell by 0.1%, according to the Federal Statistical Office (Destatis). However, the annual average price level in 2024 was 1.8% lower than in 2023, marking a significant decline after prices had risen by an average of 0.2% in the previous year.
Energy prices weigh on the overall picture
The annual average price decline is primarily due to the development of energy prices, which were 6.2% lower in 2024 than in the previous year. The fall in prices was particularly marked for natural gas (-13.3%) and electricity (-10.3%). In December 2024, petroleum products also cost less than a year earlier (-4.0%), although they rose slightly compared to the previous month (+0.3%). The price trend was different for district heating, which rose sharply by 17.2 %.
More expensive capital and consumer goods
While energy became cheaper, prices for capital goods rose by 1.8% compared to the previous year. Consumer goods also became 2.6% more expensive. The price increase was particularly strong for foodstuffs such as butter (+40.9%) and confectionery (+24.4%). In contrast, staple foods such as sugar (-32.6%) and pork (-7.0%) fell in price.
Price movements for intermediate goods
Prices for intermediate goods remained almost stable (+0.1% year-on-year). A differentiated picture emerged here: While wood products and metals became cheaper in some cases, construction and electrical components became more expensive. For example, cables and electrical installation materials cost 1.1% more than in December 2023, while prices for pig iron, steel and ferroalloys fell by 7.6%.
Annual average: differentiated development
In 2024 as a whole, the decline in producer prices was noticeable for the first time in years. Despite falling energy prices, the cost of capital goods rose by 2.2 %. Consumer goods also recorded an increase of 1.1%, with strong swings for butter (+26.6%) and confectionery (+20.1%).
The latest figures illustrate the tension between falling energy prices and rising costs in other industrial sectors. Against the backdrop of global energy and commodity markets, this development remains of central importance. It will be interesting to see what impact the tariff increases announced by the new President Trump in the USA will have on the development of producer prices. Higher import tariffs could increase the cost of intermediate goods and raw materials, which is likely to impact production costs and therefore price trends in numerous sectors. Further developments will be decisive for the competitiveness of internationally operating companies and the stability of global supply chains.

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