Chemical and Petrochemical Process Plant Price Index

Detailed information for Fourth quarter 1989

These indexes measured price changes for the construction of a processing plant representative of those used by chemical and petrochemical companies.

Data release - -

• Description
• Data sources and methodology
• Data accuracy

Description

1992=100. Proxy series
Since 1990 a proxy series for the Chemical and Mineral Process Plant Price Indexes (CMPPI) has been calculated to replace the discontinued original series and to a lesser degree the Chemical and Petrochemical Process Plant Price Indexes (CPPPPI) to satisfy the requirements of users in government and industry.
1981=100 Series, Discontinued
These indexes measure price changes for the construction of a processing plant representative of those used by chemical and petrochemical companies. These indexes are similar to the Chemical and Mineral Process Plant Price Indexes (SDDS ID 2314), except that the model is a battery limit plant (meaning that it reflects only the provision of processing facilities and supporting services necessary to the operation of the facilities), and it is restricted to plants in which only gases and liquids are processed. The ending period of the indexes is the fourth quarter of 1989.

Subjects

• Construction price indexes
• Prices and price indexes

Data sources and methodology

Sampling

This is a sample survey with a cross-sectional design.

Error detection

The data are revised 6 months (2 quarters) after release.

Estimation

In order to utilize the available prices and price indexes in the most efficient manner, the following assumptions are employed: a) the price movement of commodities of small weight is the same as that of major commodities within an account or sub-account; b) the price movement of a class of similar commodities is the same within an account or sub-account; c) the price movement of U.S. domestic price indexes adjusted for exchange rate changes are an adequate reflection of the price movement of imported machinery and equipment.

Quality evaluation

These indexes measure price change for construction of a processing plant of the sort installed by chemical and petrochemical companies. It is similar to the sort of installation described under chemical and mineral process plant price indexes except 1) the model is a battery limits rather than grass roots plant; 2) it is restricted to the sort of plant in which gases and liquids only are processed. Prices are as described for Chemical and Mineral Process Plant Price Indexes (SDDS ID 2314). Weights are derived from a study carried out by an ad hoc committee of the Canadian Chemical Producers Association and represent a typical battery limits plant installed in the early 1970's. Elements are classified according to company's codes of accounts, valued in 1981 prices.

Disclosure control

Statistics Canada is prohibited by law from releasing any information it collects that could identify any person, business, or organization, unless consent has been given by the respondent or as permitted by the Statistics Act. Various confidentiality rules are applied to all data that are released or published to prevent the publication or disclosure of any information deemed confidential. If necessary, data are suppressed to prevent direct or residual disclosure of identifiable data.

In order to prevent any data disclosure, confidentiality analysis is done using the Statistics Canada Generalized Disclosure Control System (G-Confid). G-Confid is used for primary suppression (direct disclosure) as well as for secondary suppression (residual disclosure). Direct disclosure occurs when the value in a tabulation cell is composed of or dominated by few enterprises while residual disclosure occurs when confidential information can be derived indirectly by piecing together information from different sources or data series.

Data accuracy

The reliability of these index series depends on several factors, some of which are not quantifiable. Heterogeneity and uniqueness of capital expenditures on plant equipment and construction cause considerable difficulties in terms of the continuity of price series and the evaluation of quality change. The development of the model process plant yielding the components for pricing and their relative importance required considerable input from the processing industries and their association. However price collections do not derive from these purchasing companies directly, rather they are obtained mainly from manufacturers selling price information which may only approximate the required commodity and terms of sale coverage needed for a capital expenditure type purchase price index.