September Producer Prices Hit 'All-Time High' Again... Record High for 6 Consecutive Months

Rising International Crude Oil and Raw Material Prices... Manufactured Goods Up 0.3% Month-on-Month
Third Longest Consecutive Increase in History

Due to the rise in international oil prices, gasoline prices at gas stations in Seoul have increased for four consecutive weeks, with prices exceeding 2,000 won on the 17th. Photo by Dongju Yoon doso7@

[Asia Economy Reporter Jang Sehee] South Korea's producer prices have risen for 11 consecutive months until last month, setting a new all-time high. Since recording a record high in April, it has maintained record highs for six consecutive months. This is due to price increases mainly in manufactured goods, electricity, gas, water, and waste.

According to the Bank of Korea's announcement on the 20th, the producer price index for September was 111.13 (2015=100), up 0.2% from the previous month, marking the highest level since statistics began in January 1965. It is the sixth consecutive month of record highs since April (108.06).

Producer prices have been on an upward trend for 11 consecutive months since November last year. In terms of duration, this is the third-longest rising streak after 61 months from October 1974 to October 1979 and 19 months from November 2009 to May 2011. Compared to the same month last year, it rose by 7.5%.

The producer price index measures price changes of goods and services supplied by domestic producers to the domestic market and has about a one-month lag compared to consumer prices. Considering the rise in producer prices in September, consumer prices in October are also expected to increase.

Manufactured goods, electricity, gas, water, and waste drove up producer prices. Manufactured goods rose 0.3% last month, continuing a 16-month consecutive increase. Among manufactured goods, coal and petroleum products increased by 2.1%, and primary metal products and chemical products rose by 0.4%.

Choi Jinman, head of the Price Statistics Team at the Bank of Korea's Economic Statistics Bureau, analyzed, "Manufactured goods rose mainly due to coal and petroleum products and primary metal products," adding, "Since the beginning of this year, factors such as rising international oil prices and raw material prices have continued to influence, maintaining the upward trend in producer prices."

On the other hand, agricultural, forestry, and fishery products fell 0.8% from the previous month due to favorable harvests and expanded supply. Agricultural product prices dropped by 2.0%. Livestock product prices rose by 0.6%, but the increase narrowed compared to the previous month (1.0%).

Service prices showed a flat trend compared to the previous month, with transportation services rising 0.3% while business support services fell 0.4%.

The domestic supply price index (113.81), which adds import prices to the producer price index, rose 0.3% from the previous month, mainly due to intermediate goods. Raw materials increased by 0.3%, mainly imports, and intermediate goods rose 0.4% as both domestic shipments and imports increased. Final goods also rose 0.2%, supported by an increase in consumer goods.

The total output price index (112.01), which includes export prices in the producer price index, rose 0.5% from the previous month, mainly due to manufactured goods.

Meanwhile, as the producer price, a leading indicator of consumer prices, continues to rise, inflationary pressure (sustained price increases) is expected to persist for the time being.

This content was produced with the assistance of AI translation services.