Open Source Securities: Geopolitical conflicts may increase the magnitude and persistence of PPI growth

```htmlGolden Ten Data reported on March 25 that Kaiyuan Securities pointed out, based on China's 2023 input-output table, the consumption coefficients of various PPI sub-industries for oil and gas extraction, coal mining and selection, and non-ferrous metal mining and selection were calculated. By weighting these coefficients according to the revenue proportion of the above-scale enterprises in the industry for 2025 and summing them up, the influence of the two industries on PPI cost transmission was determined. The results show: the fully cost transmission coefficient of the oil and gas extraction industry is about 9.7%, while that of the non-ferrous metal mining industry is only 1.9%. This indicates that, even though rising oil and gas prices may constrain further growth of the non-ferrous metal chain due to inflationary and recession expectations, their impact on downstream industry prices is far greater than that of the non-ferrous metal chain. If geopolitical conflicts persist, it will increase both the magnitude and duration of future PPI increases.```