According to the agricultural product distribution information of the Korea Agricultural and Fishery Food Distribution Corporation, food prices have risen significantly. Compared to the previous year, onions (1kg) jumped 59.6% to 2,575 won, rice (20kg) jumped 15.6% to 59,000 won, and sweet potatoes (1kg) jumped 43.0% to 6,042 won. The picture shows a citizen choosing onions at a supermarket in Seoul on the 15th of last month. yunhap news
The producer price index, which represents the price of goods supplied by producers to the market, rose for three consecutive months. The winter cold wave and highly pathogenic avian influenza (AI) decreased the shipment of agricultural and livestock products, and the increase in international oil prices led to the increase in industrial product prices.
According to the Bank of Korea on the 19th, the producer price index for January was 104.88, 0.9% higher than last December (103.90). It has risen for three consecutive months since last November, and the increase was the largest in four years since January 2017 (1.5%).
Major rising items in the producer price index
The producer price index is a figure that evaluates the inflation level of 892 items (788 products, 104 services) taking into account the weight when the inflation level in 2015 is assumed to be 100. Usually, fluctuations in producer prices affect consumer prices with a lag.
It was agricultural and livestock products that drove the rise in producer prices. Amidst sluggish crops due to the winter cold, the prices of agricultural and livestock products rose together with AI hit.
Specifically, the prices of onions (29.5%), green onions (53%), and pumpkins (63.7%) showed a sharp rise in prices, and the agricultural product price index rose 7.9% from the previous month. This is the largest increase since August 2018 (8.0%). The livestock price index also rose 11.8%. This is because chicken (42.8%) and eggs (34.0%) rose. The aquatic product price index also rose slightly by 1.2%.
Due to the rise in international oil prices, the price of industrial products also rose 1.0% MoM. Coal and petroleum products such as diesel (9.7%), naphtha (14%), and gasoline (7.5%) showed a clear rise. The service price index rose 0.5% as the commission for consignment purchases (9.6%) rose due to the boom in the stock market.
Kim Young-hwan, head of the inflation statistics team at the Bank of Korea, predicted that “the pressure of rising prices of oil, agri-food, raw materials, etc. is continuing,” and “the uptrend will continue in February.”
Jeonghyun Kim reporter [email protected]
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