By Brai Odion-Esene and Ian Mckendry

WASHINGTON (MNI) – U.S. import prices fell for the first time since
February of this year, down 0.6% in May from the revised April increase,
weighed down by falling fuel prices that offset the jump in non-fuel
import prices, the Bureau of Labor Statistics reported Tuesday.

Import prices rose 8.6% year-over-year for May after being up 11.2%
y/y in April.

May Fuel import prices fell by 4.9%, following a 2.7% rise in
April. Within that, both petroleum import prices — accounting for 95%
of the decrease — and natural gas import prices saw declines, down
-5.0% and -3.5% respectively.

The decline in fuel import prices is the largest monthly decrease
since it was down 22.2% in December 2008.

Year-over-year, petroleum import prices rose 35.9% and natural gas
prices rose 17.0%, pushing overall fuel prices up 33.9% for the same
period.

Nonfuel import prices last recorded a monthly decline in July 2009,
and rose 0.5% in May, and rose 3.6% over the past 12 months, the largest
12-month increase since the index went up 4.8% for the October 2007-2008
period. Non-petroleum imports rose by 0.5% in May.

The BLS said the increase in nonfuel import prices was led
primarily by higher nonfuel industrial supplies and materials (+1.9%),
with foods (+1.4%) and consumer goods excluding auto vehicles (+0.1%)
also contributing to the overall increase.

Import prices for capital goods also rose in May (+0.2%),while auto
vehicles saw no change.

By region, prices for imports from China rose 0.3%, and the index
has risen by 0.2% over the past 12 months. This is the first time it
has been positive since the twelve months ended February 2009.

Prices for imports from the European Union were up 0.1% in May.

Import prices from Mexico fell by 1.6%. Canada fell by 0.6% in May,
the first decrease since July 2009 as well.

The export price index increased for the third consecutive month,
rising 0.7% in May. The 1.4% rise in agricultural export prices and the
0.6% in non-agricultural export prices accounted for the increase, the
BLS said.

Export prices rose 5.8% year-over-year.

The report, the only one of its kind done in or out of government,
itself is largely but not entirely made up of monthly price changes
submitted voluntarily by firms, with some items priced quarterly. The
BLS also makes quality adjustments to the price quotes if the product
has been improved.

** Market News International Washington Bureau: 202-371-2121 **

[TOPICS: MAUDS$,M$U$$$,MT$$$$]