Interior of a large discount chain in Seoul on Monday (Yonhap)
SEJONG -- A spike in import prices of agricultural, livestock and fisheries products is estimated to have propelled a recent sharp growth in the nation’s overall consumer prices, data from a research institute showed Monday.
According to the Korea Trade Statistics Promotion Institute, the index for import prices of agricultural, livestock and fisheries products reached 112.6 in February, up 31.7 percent from a year earlier.
The index is calculated under the assumption that prices was at the 100 level in 2015. On-year figures climbed for the third consecutive month, following a 33.5 percent growth in December 2021 and 31.5 percent in January.
In February, import prices of agricultural products rose by 33.3 percent on-year, the institute data showed.
Among grains, a 68.1 percent surge was seen in import prices of green beans, 58.4 percent in milling wheat, 52.4 percent in corns for feeding and 42.3 percent in corns for processing. In particular, prices of wheat and corns directly affect consumer prices as these are used as raw materials for a variety of processed food.
In vegetables, prices of radishes climbed by 270.6 percent, carrots by 61.8 percent, onions by 57.3 percent and garlic by 52.3 percent. Among fruit, a 20.7 percent growth was reported in pineapples, 19.1 percent in grapes and 13.6 percent in lemons.
Import prices of livestock rose by 36.7 percent, compared to February 2021.
Prices of beef rose between 47 percent-53 percent, chicken by 47.5 percent and pork by 6.4 percent.
Prices of fisheries products reported a 13.5 percent increase: 38.6 percent in live fish, 30 percent in fresh fish and 8.8 percent in frozen fish.
Market insiders say the growth is mainly attributed to a sharp growth in global demand during the process of economic normalization amid the pandemic.
They say that import prices in March are estimated to have posted sharper growth in the wake of Russia’s invasion of Ukraine in late February.
Another factor for the high import prices is the Korean currency’s weakness against the US dollar. The dollar, which traded at 1,101.4 won on Feb. 15, 2021, rose to 1,199.8 won on Feb. 15, 2022. Since Feb. 24, dollar prices have continued to stay over the 1,200 won mark.
The cheap won is undermining purchasing power of both households and businesses.
On the same day, Ahn Cheol-soo, chairman of the presidential transition team, said there is a need for the government to keep the power and gas rates unchanged -- or minimize the rate of hikes -- to ease business sector burdens.
He said more businesses, alongside households coping with high consumer prices, are suffering due to the skyrocketing prices of raw materials including international crude.
He also saw a need for both the incumbent and coming administrations to take preemptive countermeasures against a spike in international raw materials prices.
Mentioning the sharp increase in cement prices in the wake of the Ukraine-Russia war, Ahn called for the incumbent administration to seek diversification of import routes, such as conducting active import of bituminous coal from Australia, in a prompt manner.
By Kim Yon-se (firstname.lastname@example.org)