PURCHASING'S Industrial Supplies Price Index (ISPI) slipped to 103.6 (1992=100), its lowest level since August 1999.

Of the seven groups of materials tracked monthly, indexes for industrial energy, wood products, chemicals and plastic resins slipped in December while price indexes for wood pulp and paper products were flat and the metals price gauge inched upward. Energy product pricing dropped almost 5% for a second consecutive month, reflecting a continued slide in prices for crude oil as well as refined products. So, it's little wonder that transaction tags softened for energy-intensive chemicals and resins as well.

Buyers surveyed by PURCHASING Magazine see prices for most industrial commodities rising slightly by midyear but not enough to be worrisome. This is due partly to the fact that they have already locked in contract pricing at levels below what they paid in 2001 and partly to their expectations that commodity supplies will continue to outpace demand at least for the first half of 2002. They also see transaction tags dropping for some key chemicals and resins.