COLOMBO, Sri Lanka – 31 August 2026 – Sri Lanka’s Department of Census and Statistics (DCS) today released the latest Producer Price Index (PPI) for July 2026, revealing a significant 5.0 percent year-on-year increase. The overall PPI for all economic activities, encompassing Agriculture, Manufacturing, and Utility sectors, reached 249.7 in July, indicating an upward trend in prices received by domestic producers.
The Producer Price Index is a crucial macroeconomic indicator that measures the average change over time in prices received by domestic producers for their goods and services. It provides valuable insights into short-term inflationary trends, serves as a deflator for economic series, and is utilised in productivity analysis, contract escalation, and business accounting. The DCS, operating under the Ministry of Finance, Planning and Economic Development, rebased the PPI to 2018 Q4 in 2021 and has since maintained a consistent release schedule, currently with a 30-day lag.
Annual Price Movements: Utility Sector Leads the Surge
On a year-on-year basis, the 5.0 percent increase in the overall PPI reflects varied performances across the major economic sectors. The Utility Sector (Electricity, gas, steam and air conditioning supply, and water supply) recorded the most substantial annual increase at 18.9 percent, with its index value reaching 182.8. This was largely propelled by a 23.0 percent rise in “Electricity, gas, steam and air conditioning supply” and a 5.5 percent increase in “Water collection, treatment and supply”.
The Manufacturing sector also saw a robust annual rise of 5.3 percent, with its index standing at 253.2. Several sub-activities within manufacturing experienced significant price growth, including “Manufacture of coke and refined petroleum products” (51.5%), “Manufacture of rubber and plastics products” (16.6%), and “Manufacture of other non-metallic mineral products” (12.6%). Other notable increases were observed in “Manufacture of wearing apparel” (10.0%), “Manufacture of other transport equipment” (8.1%), and “Manufacture of chemicals and chemical products” (7.6%). Conversely, some manufacturing sub-sectors reported decreases, such as “Manufacture of furniture” (-9.4%) and “Manufacture of textiles” (-0.7%).
The Agriculture sector, with an index of 248.4, registered a modest annual increase of 0.1 percent. Within agriculture, “Growing of perennial crops” and “Animal production” reported positive changes of 14.8 percent and 3.5 percent respectively, while some sub-sectors reported negative changes, such as “Growing of non-perennial crops” which recorded an 8.8 percent decline annually.
| Major Economic Activity | PPI July 2025 | PPI July 2026 | Year-on-Year Change (%) |
|---|---|---|---|
| All Activities | 237.7 | 249.7 | 5.0 |
| Agriculture | 248.1 | 248.4 | 0.1 |
| Manufacturing | 240.4 | 253.2 | 5.3 |
| Utility (Electricity, gas, steam and Air conditioning supply & Water supply) | 153.7 | 182.8 | 18.9 |
Source: Department of Census and Statistics (Base: 2018 Q4=100)
Monthly Trends: Overall PPI Increases by 0.5 Percent
Looking at month-on-month changes, the overall PPI witnessed a 0.5 percent increase, rising from 248.6 in June 2026 to 249.7 in July 2026. This translates to an increase of 1.1 index points. The Agriculture sector recorded a positive monthly change of 2.5 percent, with “Growing of perennial crops” and “Animal production” increasing by 6.3 percent and 3.4 percent respectively. However, “Growing of non-perennial crops” experienced a negative change of 1.7 percent.
The Manufacturing sector also showed a marginal positive monthly change of 0.2 percent. Notable increases were seen in “Manufacture of beverages” (1.6%), “Manufacture of rubber and plastics products” (0.6%), and “Manufacture of food products” (0.3%). In contrast, “Manufacture of other non-metallic mineral products” (-1.0%) and “Manufacture of other transport equipment” (-0.8%) recorded negative monthly changes. The Utility sector remained unchanged compared to the preceding month.
| Major Economic Activity | PPI June 2026 | PPI July 2026 | Month-to-Month Change (%) |
|---|---|---|---|
| All Activities | 248.6 | 249.7 | 0.5 |
| Agriculture | 242.3 | 248.4 | 2.5 |
| Manufacturing | 252.5 | 253.2 | 0.2 |
| Utility (Electricity, gas, steam and Air conditioning supply & Water supply) | 182.8 | 182.8 | 0.0 |
Source: Department of Census and Statistics (Base: 2018 Q4=100)
Understanding the Producer Price Index
The PPI, covering agriculture, manufacturing, and utility sectors, is compiled from prices collected from 277 manufacturing and utility-related establishments, and 42 agricultural products from 331 Divisional Secretariat Divisions across the country. Prices for electricity, gas, steam, air conditioning, and water supply sectors are sourced from the Ceylon Electricity Board and the National Water Supply and Drainage Board, respectively.
Indices for the latest month are typically released as provisional, as it may not be possible to collect all required prices by the time of release, necessitating statistical imputation. The DCS aims to provide accurate and timely statistics to foster informed policy decisions and contribute to a more comprehensive understanding of the nation’s economic landscape.
The PPI for August 2026 is scheduled for release on 30 September 2026.
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