The price indices for February 2014 have been calculated.

All the main indices show deflation in February 2014, except the Mineral Price Index, which shows a 2.6% inflation. In January, by contrast, the inflation in the Mineral Price Index was 4.2%. This blog takes a look at mineral trade in the wake of (and during) the battle of B-R5RB.

Looking at the total value of traded minerals in the graph below, it is apparent that the mineral market was noticeably affected on the day of the battle of B-R5RB. A shift in level is shown by separating the series and drawing linear trend lines through them before and after the battle. The series before the battle is quite stable, whereas the series after jumps significantly but then starts to trend down towards the previous level.

A look at the trade value for each of the minerals in the graph below shows that the biggest effect by far was on Tritanium. The main spike in the trade of Tritanium comes on January 27 and January 28, the days of the battle, but then dies down. A second, smaller spike happens at the beginning of February and affects all minerals except for Morphite. This second spike then fades slowly.

Taking a closer look at Tritanium, the graph below shows the effect on the daily average price and traded volume. Over the seven days before the battle, the average price of Tritanium was 4.75 ISK, while traded quantity averaged 42 billion units.

On January 28, the second day of battle, the price had risen by 18% to 5.59 ISK, and daily traded quantity jumped by 138%. The week after the battle, the price subsided to 4.89 ISK, only 3% above what it was the week before battle; traded quantity, however, was still 32% higher.

This sudden and short-lived effect on Tritanium warrants a closer look.

The following figure graphs the hourly trade value of Tritanium on the two days of the battle of B-R5RB (blue line) and compares is to the same days the week before (orange line). Additionally, the columns show the number of Titans destroyed (right axis) each hour on the two days of the battle.

No real changes happen after the first Titan falls, but in the second hour of battle, when two more Titans go down, the market reacts and the trade value rises sharply. It then follows the ”Titan death count“ pretty well and ends with one last spike. After that the market calms down.

Looking at the long-term trend in mineral trade value shows that the market has resumed the level it was at before the battle, although day to day fluctuations are perhaps slightly larger than before.

 

In other news, all the other main price indices showed deflation in February. The Primary Producer Price Index dropped by 5.3%, which was mostly driven by moon materials and hybrid polymers. The Secondary Producer Price Index fell by 3.5%, where the biggest contributors where planetary commodities, salvage and Tech II construction components. Finally, the Consumer Price Index showed a deflation of 0.6%, with most categories showing a mild deflation. There were two main exceptions to the deflation in the CPI.

One was PLEX prices, which rose by only 1% but weighed a whopping 24% in the index. The other was Tech I ship prices, which rose by 3.8% due to the effect the battle of B-R5RB had on mineral prices.

The index values for February are:

	February 2014	1 Month Change	12 Month Change
Mineral Price Index	114.3	2.6%	-12.0%
Primary Producer Price Index	72.2	-5.3%	-18.6%
Secondary Producer Price Index	98.4	-3.5%	-17.7%
Consumer Price Index	78.5	-0.6%	-4.7%

The following graph shows the development of the indices since October 2003.

The battle of B-R5RB clearly illustrated the massive scope of EVE Online, and was probably the biggest PvP battle in gaming history. This caught the attention of the media, which emphasized the size of it all, the organization of thousands of people all over the planet, the time commitment, the intelligence work, the planning, and the incredible real world value of the virtual ships lost.

But what the battle also showed is how ruthlessly efficient the EVE market is, even when dealing with such shocks to the system.

 

 

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Retribution brought 5 new ships, the Venture mining frigate and the 4 destroyers; Algos, Corax, Dragoon and Talwar.  From December 4 to the end of the year, 107,273 blueprints were sold for the new ships. The trade value was 848 billion ISK. As the following figures shows, the Venture was the most popular.

Over the same period, manufacturers produced 311,575 of these ships, while some 237,469 were traded, for total of 669 billion ISK.

Continue reading The New Ships of Retribution (Price Indices – December 2012) →

Expansions spur trading, both prior to realease and after.  The effect of the preparation for Retribution can best be seen in the Mineral Price Index, which rose by 8% from October to November.  A rise was to be expected, as Retribution brought new Tech I ships and major changes to many of the already existing Tech I ships.

Nocxium, Isogen and Zydrine prices contributed most to the rise in the MPI.  The prices of these three minerals rose by 17%, 20% and 26% respectively.  The price of Morphite rose by 33% in the period, even though it is not used in the production of the new or modified ships.  On the other hand, the prices of Tritanium, Pyerite and Mexallon were very lightly affected.  Only Isogen and Morphite show a notable increase in traded volume between months.  The increase is 17% for Isogen and 20% for Nocxium.  Traded volume of other minerals remains stable or even falls, as is the case for Zydrine and Megacyte.

The following graph shows how Retribution affected the manufacturing of frigates, destroyers and cruisers.

There may have been less hoarding of minerals than one might have expected prior to this expansion.  There was, however, some discussion among traders about the announced changes to NPC supplied containers, which are now made by players.  There was the possibility that the new player-made containers would be recyclable, making it possible for industrialists to gain vast quantities of minerals from local NPC supply, thus saving on transportation hassle.  Given enough material requirements, the recycled materials might even have become much cheaper than market prices.  Pilots may remember a similar incident from the introduction of Planetary Interaction.

The following graph shows the trade in containers.

The data shows some large but isolated spikes in container sales but not an all out frenzy.  Total container sales in October and November were only 86% above the total sales value for August and September.  It‘s heartwarming to see that the majority of players did not risk their money on CCP repeating the mistake from the introduction of Planetary Interaction.  However, there were a few that did.  The biggest single buyer of containers in the period from the dev blog announcement to deployment bought containers for 28 billion ISK.  There‘s a good chance there‘s a station out there somewhere where you can get a good price on containers on the secondary market.

The index values for November are:

	November 2012	1 Month Change	12 Month Change
Mineral Price Index	130.6	8.1%	68.5%
Primary Producer Price Index	84.9	-1.7%	3.0%
Secondary Producer Price Index	108.2	-0.6%	-5.6%
Consumer Price Index	81.8	0.7%	14.6%

Changes in the Mineral Price Index have already been covered.  The Primary Producer Price Index showed a 1.7% deflation, driven by datacores supplied from Factional Warfare, while the Secondary Producer Price Index  saw 0.6% deflation, with hardly any changes of note.  The Consumer Price Index displayed 0.7% inflation, with most categories changing very little.  Most of the inflation is caused by an 11% rise in implant prices, which has to do with loyalty points being a bit harder to come by in Factional Warfare.

All in all, this was fairly quiet month on the markets, except for the mineral market.  The figures for December will obviously be less stable and the effect of the rising mineral prices and increased activity should become clearly visible as inflation in consumer prices.

For more detail on the indices, please refer to the Market Indices page on Evelopedia.

Full series of the four main price indices in Excel format.

Full series of the four main price indices in CSV format.

It’s been a while since we released a dev blog on the New Eden price indices and the things that affect them. The last dev blog on the subject discussed the effect of the changes in loot drops, the Burn Jita event and Hulkageddon. These had a major impact on the supply and price of minerals and ice.

The focus of this blog stays on the price of minerals and ice. We will look at the effect of the fundamental changes to mining barges and exhumers, which were deployed in Inferno 1.2 on August 8. The smaller mining barges and exhumers were given specialized roles, instead of being inferior versions of the bigger ships. The Procurer and the Skiff now have superior defenses, while the Retriever and the Mackinaw have the largest ore holds. The Covetor and the Hulk still have the best mining yield, even though the other were given yield bonuses to compensate for fewer mining hardpoints.

We’ll start by looking at the effect on manufacturing. The following graph shows the number of each type of mining barge produced since the end of 2005. The reason for showing the series so far back into antiquity, is to emphasize how little this series tends to change.

click to enlarge

There was a mini-spike in April, this year, when loot drops were changed, which increased the importance of mining. The mining barge changes, however, caused a gigantic spike in the production of the smaller vessels. The average monthly number of Retrievers produced in the first half of the year was 13,600 ships. Production in August and September exceeded that figure by 492% and 284% respectively. Manufacturing figures for the Procurer are even more dramatic, as its average monthly figure of nearly 2,000 ships was exceeded by 4781% in August and by 9706% in September. On the other hand, Covetor production was stable in August but fell by 58% in September.

Manufacturing of exhumers shows a similar pattern, albeit at a much smaller scale.

click to enlarge

Mackinaw production in August and September rose by 183% and 93% respectively, while the Skiff figures for the same months are 659% and 208% above the monthly average. The drop in Hulk production is 51% and 82% for these months.

October figures show the spike dying down. Retriever production is back where it was before the changes, while production of Procurers, Skiffs and Mackinaws is falling, but still quite high. However, the drop in the figures for Covetors and Hulks is probably permanent and hasn’t been this low since 2006/2007.

The effect on manufacturing is clear, but what effect did the changes have on the use of these ships? The following graphs shows how often players make mining barges and exhumers their active ship in addition to the number that log in with those ships active. This doesn’t show how long they stay active, but it’s probably useable as an indicator of changing use.

click to enlarge

Counting all barges and exhumers in one series, we get the following graph.

click to enlarge

This suggests that overall use of these ships has increased substantially following the changes. Another way to look at it is through mined volume, as shown below.

click to enlarge

The mining ship changes have led to a very large increase in mined volume. The new versions of the ships clearly provide useful mining alternatives to pilots willing to trade off some mining output for a reduced risk of suicide ganks or less workload shoveling ore to a jet can. Of course, the last part means greater opportunities for AFK-mining. That, in turn, probably explains why the Retriever has become the most commonly used mining ship, and also why the increase in mining activity is focused on high-security space.

What effect did this increase in mining activity have on the price of minerals and ice? The most notable mineral price changes in August were a 25% drop in Morphite prices and a 16% fall in Nocxium prices, while September and October changes in mineral prices were quite limited. However, the price indices for ice and ice products dropped by 33%, both in August and September, before stabilizing in October.

click to enlarge

What makes the actual effect rather hard to measure is that this happens shortly after the loot changes, the burning of Jita and Hulkageddon, which significantly disrupted the supply of ore and ice. This makes it hard to tell whether a decline in price is the result of the increased mining activity or just a recovery from the price hike caused by the preceding supply disruption.

The index values for October are:

	October 2012	1 Month Change	12 Month Change
Mineral Price Index	120.8	0.9%	59.2%
Primary Producer Price Index	86.4	-3.0%	7.7%
Secondary Producer Price Index	108.9	-1.9%	-2.1%
Consumer Price Index	81.2	2.1%	19.4%

As previously mentioned, mineral price changes in October were quite limited, mostly cancelling each other out, resulting in a total change of 0.9%. The 3% deflation in the Primary Producer Price Index was mainly driven by moon materials and datacores. Datacores are still falling after Factional Warfare pilots became their primary suppliers. However, the drop in moon material prices would be a case for a wholly separate and risky study, including cartel dynamics and rumours thereof. The 2% deflation in the Secondary Producer Price Index was primarily driven by falling prices of Tech II construction components (caused by lower moon material prices), and from salvaged materials, which fell by less than 7% but weigh very heavily in the index. Finally, the 2% inflation in consumer prices is almost solely driven by PLEX prices, while most other consumer products experienced deflation in October. Without PLEX, the CPI would have shown 1% deflation.

click to enlarge

Based on the increased diversity of mining barges used, it would seem safe to assume that the changes to mining barges and exhumers turned out well. The main effect of the changes seems to have taken about 2 months to materialize. The tanked versions of the mining ships probably won’t have a major effect on the next Hulkageddon, since anything flying in high-security space can be suicide-ganked. However, the cost of suicide-ganking Skiffs and Procurers should have increased a little as a result of the changes. Finally, it should prove interesting to see, if the new mining frigate that’s coming in Retribution will affect mining in a significant way.

For more detail on the indices, please refer to the Market Indices page on Evelopedia.

Full series of the four main price indices in Excel format

Full series of the four main price indices in CSV format

 

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Returning pilot? Visit Account Management for the latest offers and promotions.

When some people notice a fire, their instinctive reaction is to reach for a bucket of fuel.   Many of those people play EVE.

The heavy inflation that has characterized the economy since December is starting to subside, with the Mineral Price Index falling by 7.9% in May. Inflation reached its peak between March and April, where the biggest change in prices was in the MPI, which jumped by an incredible 32%.  Prior to this, the biggest change ever recorded in the MPI was a 13% rise in December 2003.  The only time one of the main indices had jumped higher in one month was in July 2010, when the SPPI rose by 38% following the Tyrannis expansion, which introduced Planetary Interaction.  The accumulated rise in the MPI from November 2011 to April was 75%.

The release of Crucible, on November 29, started the ascent of the mineral prices in earnest, with heightened activity and increased demand.  Then came the decision to make some drastic changes to loot drops, which were an important source of minerals.  This was announced at Fanfest, which sent prices soaring.  When the changes were deployed to Singularity, players got the chance to better quantify the impact of the changes.  Prices only rose slightly more as a result of this, but then mostly stayed stable until implementation on Tranquility in Escalation, on April 24.

From the announcement at Fanfest to implementation in Escalation, speculating traders stockpiled large quantites of minerals, for resale after launch.  The following figure shows the daily development of the MPI from July 2011.

Click to enlarge

A very large group of entrepreneurs gathered an immense fleet in Jita for Burn Jita, an event so big that it made the news.  This targeting of the main trade hub of Jita caused massive destruction.  The following graph shows the destroyed mass of ships in Jita on the weekend of Burn Jita and the weekend prior to it.  Tonnage destroyed during Burn Jita was 23 times that of the previous weekend.  A total of 15,766 ships were destroyed, having a total mass of 123 Megatonnes, and that‘s not counting the cargo or the fittings.

Even more importantly, Burn Jita marked the beginning of Hulkageddon, an event aimed at destroying mining vessels and lasting a full month.  Hulkageddon suppresses the supply of minerals, which forces prices upwards.  The following graph shows how total volume mined dropped during Hulkageddon.  It mixes all ore types together and is used here to show mining activity, rather than value.

Click to enlarge

As can be seen from the first graph, mineral prices actually started falling sharply after the release of Escalation and fell even more sharply following the burning of Jita.  This is where the bubble of speculation and manipulation burst, as owners of mineral stocks cashed in.  However, Hulkageddon has unquestionably served to slow the fall, so mineral prices can be expected to fall further following the end of the event.

The index values for May are:

	May 2012	1 Month Change	12 Month Change
Mineral Price Index	125.0	-7.9%	65.1%
Primary Producer Price Index	118.9	5.5%	47.2%
Secondary Producer Price Index	110.3	-1.7%	4.5%
Consumer Price Index	83.8	1.6%	26.1%

Consumer prices rose by 1.6%, primarily driven by ice products, which are also affected by Hulkageddon.  The Primary Producer Price Index climbed by 5.5%, in which ice and moon materials were the dominant contributors.  On the other hand, the Secondary Producer Price Index fell by 1.7%, with deflation in most notable categories, except Tech II construction components.

Click to enlarge

It was obvious from the start, that the fundamentral changes being made to loot would upset the mineral market in a major way, which would affect other markets as well.  However, as one source of minerals fades, rising prices boost other sources and the market finds a new equilibrium.  In the long-term, the economy is probably in reasonably good health, although  it does seem to have bad case of the flu at the moment.  It should prove interesting to watch it recover over the next 2 to 3 months.

For more detail on the indices, please refer to the Market Indices page on Evelopedia.

Full series of the four main price indices in Excel format

Full series of the four main price indices in CSV format

There can be little doubt about what the coolest aspect of EVE is.  Inflation, money supply and the velocity of money is where it‘s at, right?  Well, that‘s what this blog is about.

Three of four main price indices show considerable inflation in February, ranging from 1.4% for the Consumer Price Index to 8.1% for the Mineral Price Index.  This inflation has been evident since last August.  Many have suggested that this is caused by the rewards coming from Incursions.

There‘s certainly a lot of money coming from Incursions.  Incursion rewards in December amounted to 9.6 trillion ISK, which is an all time high, while the rewards in January and February were 9.0 and 8.7 trillion ISK respectively.  That‘s quite a bit of money entering the economy.  However, Incursions are not the biggest ISK faucet, bounties are.  Bounty prizes paid out in February totalled 33 trillion ISK.

The following graph shows the development of the Consumer Price Index and and the money supply per subscriber.  The money supply is shown as an index to facilitate comparison.

Changes in the money supply dwarf the changes to prices.  While the money supply grew more than thirteenfold, the CPI fell by almost a quarter.  It‘s clear that these series aren‘t strongly correlated.  The existence of money alone doesn‘t contribute much to inflation.  Money that isn‘t being spent won‘t affect prices.  This brings us to the concept of the velocity of money, i.e. frequency with which a given quantity of money changes hands in transactions.  It can be stated as the total value of all transactions in a period, divided by the money supply.  In our case, we shall be using monthly measurements, i.e. market transactions per month divided the average money supply that month.  Only transactions on the general market are included.  Transactions through contracts, direct trade and loyalty point stores are excluded.  The following figure compares the monthly velocity of money to the Consumer Price Index.

Here we see a proper correlation between the two series, at least until year 2009.  The velocity of money falls steeply and steadily from the start of the graph, January 2007, until late 2008.  This is happening at a time when the money supply was growing.  As the increased money supply wasn‘t increasing trade to the same degree, the result was a lower velocity of money.  An important factor in this was probably the absence of a trusted banking sector, which could offer interest and distribute the unused ISK to those in need of funds.  It‘s also important to note that money supply and the velocity of money are far from being the only things that affect inflation.  Supply side changes can have a big impact on prices.  This was the case in 2007 when Invention was introduced to Tech II production, which dramatically reduced Tech II prices.

The correlation between the velocity of money and the CPI seems to change by the end of 2008.  From January 2007 to October 2008, the correlation between the two series is 0.86, which is quite strong for a non-academic case like this one.  From November 2008 to February 2012 the correlation is -0.01, which is just about as uncorrelated as possible.  So, what happened in November 2008?  PLEX was introduced.  PLEX seems to increase the velocity of money in the New Eden economy as it “liberates“ ISK from people with more money than they know what to do with and gets it to ISK needy people that create and sell PLEX.

Obviously, the intricacies of the mechanics behind inflation are far more complex than described here, as evidenced by the vast literature and the various schools of thought on the subject.  We may dive deeper into this in the future, but for now we‘ll just put it out there for discussion.

As previously mentioned, three of four main price indices measured considerable inflation last month.  This inflationary trend is most likely driven from the demand side, as suggested by increasing velocity of money, but also by generally increased activity within EVE.  More jumps are being made, more missions being run, more PvP kills are being made and so forth.  But where such happy times roam, inflation tends to follow.

The index values for February are:

	February 2012	1 Month Change	12 Month Change
Mineral Price Index	87.7	5.2%	20.8%
Primary Producer Price Index	88.2	4.3%	22.3%
Secondary Producer Price Index	116.8	1.6%	6.1%
Consumer Price Index	75.1	3.4%	16.7%

The following graph shows the development of the indices since October 2003.

The only index showing deflation in February is the Secondary Producer Price Index.  The reason for this is a fall in the prices of goods from Planetary Interaction, which outweighs the inflationary effect from other product categories.  This fall comes as the market settles down after period of rapid rise in the price of PI made goods.  This rise was caused by uncertainty and increased cost for PI production, following the announcement and implementation of player-owned customs offices.

For more detail on the indices, please refer to the Market Indices page on Evelopedia.

Full series of the four main price indices in Excel format

Full series of the four main price indices in CSV format

 

Catch CCP Recurve and his economical friends at Fanfest 2012! More information on Fanfest topics, tickets and travel can be found here. Staying at home? Then don't forget the EVE TV Live Stream!

New to EVE? Start your 14-day free trial today.
Returning pilot? Visit Account Management for the latest offers and promotions.

There can be little doubt about what the coolest aspect of EVE is.  Inflation, money supply and the velocity of money is where it‘s at, right?  Well, that‘s what this blog is about.

Three of four main price indices show considerable inflation in February, ranging from 1.4% for the Consumer Price Index to 8.1% for the Mineral Price Index.  This inflation has been evident since last August.  Many have suggested that this is caused by the rewards coming from Incursions.

There‘s certainly a lot of money coming from Incursions.  Incursion rewards in December amounted to 9.6 trillion ISK, which is an all time high, while the rewards in January and February were 9.0 and 8.7 trillion ISK respectively.  That‘s quite a bit of money entering the economy.  However, Incursions are not the biggest ISK faucet, bounties are.  Bounty prizes paid out in February totalled 33 trillion ISK.

The following graph shows the development of the Consumer Price Index and and the money supply per subscriber.  The money supply is shown as an index to facilitate comparison.

Changes in the money supply dwarf the changes to prices.  While the money supply grew more than thirteenfold, the CPI fell by almost a quarter.  It‘s clear that these series aren‘t strongly correlated.  The existence of money alone doesn‘t contribute much to inflation.  Money that isn‘t being spent won‘t affect prices.  This brings us to the concept of the velocity of money, i.e. frequency with which a given quantity of money changes hands in transactions.  It can be stated as the total value of all transactions in a period, divided by the money supply.  In our case, we shall be using monthly measurements, i.e. market transactions per month divided the average money supply that month.  Only transactions on the general market are included.  Transactions through contracts, direct trade and loyalty point stores are excluded.  The following figure compares the monthly velocity of money to the Consumer Price Index.

Here we see a proper correlation between the two series, at least until year 2009.  The velocity of money falls steeply and steadily from the start of the graph, January 2007, until late 2008.  This is happening at a time when the money supply was growing.  As the increased money supply wasn‘t increasing trade to the same degree, the result was a lower velocity of money.  An important factor in this was probably the absence of a trusted banking sector, which could offer interest and distribute the unused ISK to those in need of funds.  It‘s also important to note that money supply and the velocity of money are far from being the only things that affect inflation.  Supply side changes can have a big impact on prices.  This was the case in 2007 when Invention was introduced to Tech II production, which dramatically reduced Tech II prices.

The correlation between the velocity of money and the CPI seems to change by the end of 2008.  From January 2007 to October 2008, the correlation between the two series is 0.86, which is quite strong for a non-academic case like this one.  From November 2008 to February 2012 the correlation is -0.01, which is just about as uncorrelated as possible.  So, what happened in November 2008?  PLEX was introduced.  PLEX seems to increase the velocity of money in the New Eden economy as it “liberates“ ISK from people with more money than they know what to do with and gets it to ISK needy people that create and sell PLEX.

Obviously, the intricacies of the mechanics behind inflation are far more complex than described here, as evidenced by the vast literature and the various schools of thought on the subject.  We may dive deeper into this in the future, but for now we‘ll just put it out there for discussion.

As previously mentioned, three of four main price indices measured considerable inflation last month.  This inflationary trend is most likely driven from the demand side, as suggested by increasing velocity of money, but also by generally increased activity within EVE.  More jumps are being made, more missions being run, more PvP kills are being made and so forth.  But where such happy times roam, inflation tends to follow.

The index values for February are:

	February 2012	1 Month Change	12 Month Change
Mineral Price Index	87.7	5.2%	20.8%
Primary Producer Price Index	88.2	4.3%	22.3%
Secondary Producer Price Index	116.8	1.6%	6.1%
Consumer Price Index	75.1	3.4%	16.7%

The following graph shows the development of the indices since October 2003.

The only index showing deflation in February is the Secondary Producer Price Index.  The reason for this is a fall in the prices of goods from Planetary Interaction, which outweighs the inflationary effect from other product categories.  This fall comes as the market settles down after period of rapid rise in the price of PI made goods.  This rise was caused by uncertainty and increased cost for PI production, following the announcement and implementation of player-owned customs offices.

For more detail on the indices, please refer to the Market Indices page on Evelopedia.

Full series of the four main price indices in Excel format

Full series of the four main price indices in CSV format

 

Catch CCP Recurve and his economical friends at Fanfest 2012! More information on Fanfest topics, tickets and travel can be found here. Staying at home? Then don't forget the EVE TV Live Stream!

New to EVE? Start your 14-day free trial today.
Returning pilot? Visit Account Management for the latest offers and promotions.