Status
The variant of the North American Product Classification System (NAPCS) Canada 2022 version 1.0 for the Industrial Product Price Index (IPPI) was approved as a departmental standard on September 24, 2021. The new IPPI variant is based on NAPCS Canada 2022 Version 1.0, and replaces the previous IPPI variant based on NAPCS Canada 2017 Version 2.0.
Changes
The Industrial Product Price Index measures price changes for major commodities sold by manufacturers in Canada. As our economy evolves, changes in our products must be reflected in the product classification used. Subsequent to the release of the updated NAPCS Canada 2022 version 1.0, the variant for IPPI has been updated.
Changes to any variant may originate from modifications applied to the standard classification it is based on, as well as from revisions to the structure of the variant itself such as NAPCS Group 158-Waste and scrap of plastic and rubber was moved in version 2022 back to the more appropriate variant grouping P32-Plastic and rubber products.
Changes to the standard classification are described in the introduction of each new version of NAPCS Canada. Here are some examples of the changes:
Creation of new classification items: Seven classification items or categories were added as "new" in NAPCS Canada 2022 Version 1.0.
Combination of classification items: Combinations consist of mergers and take-overs among classification items. Essentially, new groupings were created with the intent to re-organize the classification. In NAPCS Canada 2022 Version 1.0, 18 classification items or categories resulted in mergers,
Transfer of classification items or their parts:
E-book readers devices were transferred from NAPCS subclass 362212 – Television and other audio and video equipment to NAPCS subclass 361111 – Computers.
Parts of musical instruments transferred from NAPCS class 36221 – Television and other audio and video equipment to NAPCS class 47534 – Musical instruments.
Electronic cigarettes were transferred from NAPCS subclass 381253 – Other electrical equipment and components, n.e.c to NAPCS subclass 212113 – Electronic cigarettes (except containing cannabis).
E-liquids were transferred from NAPCS class 27213 – Chemical products, n.e.c. to NAPCS class 21211 – Cigarettes (including electronic cigarettes), cigars, chewing and smoking tobacco.
Hosiery transferred from NAPCS class 23112 -Women's clothing and NAPCS class 23114 – Clothing accessories, vestments, costumes and unisex clothing to a new 5-digit NAPCS class 23115 – Non-binary and gender-neutral clothing; hosiery; vestments and costumes; and clothing accessories.
Leather shoelaces were transferred from NAPCS subclass 231312 – Other leather and allied products to NAPCS subclass 231214 – Other footwear, with their own new 7-digit detail category 2312199.
Decomposition of classification items:
Pulse flour (see subclass 182124);
Cannabis extracts and concentrates (see detail category 2131321) broken down into cannabis pure intermediates (see detail category 2131351), cannabis extracts inhaled and ingested products (see detail categories 2131362, 2131363, 2131364, 2131365). Other cannabis extracts (see detail category 2131369)
Other cannabis products, n.e.c. (see subclass category 213134);
Other chemical products (see subclass 272136);
Thermosetting resins, except biodegradable (see class 28113);
Biodegradable plastic resins (see class 28114);
Polyethylene resins (see class 28112);
Waste and scrap of plastic (see subclass 158111).
Background
In order to create a price index, price data is aggregated into distinct product classes. From the 1980s until 2013, the product classification system used by the IPPI was the Principal Commodity Groups. However, changes in the economy required periodic updates in the classification systems. Following the approval of NAPCS Canada 2012 as a departmental standard, the IPPI and the Raw Materials Price Index (RMPI) variants were approved as departmental standards in May 2013.
NAPCS is a product classification developed and updated jointly by Canada, Mexico and the United States. NAPCS Canada is the Canadian version, and has a different structure than the trilateral NAPCS (for more details, see the Introduction of NAPCS Canada 2022 V1.0). NAPCS Canada has been implemented by most Statistics Canada programs that have a "product" (goods and services) dimension. As new updated versions of NAPCS Canada are created, the IPPI is also updated.
The IPPI reflects the prices that manufacturers in Canada receive as goods leave the plant gate. It excludes indirect taxes and all the costs that occur between the time a good leaves the plant and the time the final user takes possession of it, including transportation, wholesale and retail costs.
The IPPI is produced and published together with the Raw Materials Price Index (RMPI). Both indexes are of value in analytical studies of price formation and historical comparisons. Both are used to calculate the real Gross Domestic Product (GDP) by industry.
The IPPI employs a regrouping variant, it introduces alternative aggregate levels by regrouping categories of NAPCS Canada, the base statistical classification. In the IPPI variant, NAPCS Canada is generally aggregated at the three-digit group level and, to a lesser extent, at the five-digit class level. The coding is alphanumeric and each variant has its own codes at the section and/or group levels. For example, in the IPPI, a letter and two digits are used for the 21 section codes (i.e., P11 to P92).
One of the purposes of the six-digit subclass level in NAPCS Canada 2022 is to support the IPPI and RMPI programs. There are 1,477 subclasses at the six-digit level of NAPCS Canada 2022 Version 1.0, of which 682 are included in the IPPI and 102 in the RMPI.
Hierarchical structure
The structure of the NAPCS Canada 2022 Version 1.0 variant for IPPI is hierarchical. It is composed of five levels.
level 1: section (three-character alphanumeric codes)
level 2: group (three-digit standard codes and four-character alphanumeric codes)
level 3: class (five-digit standard codes and six-character alphanumeric codes)
level 4: subclass (six-digit standard codes)
level 5: detail (seven-digit standard codes)