[Inflation Impacting Livelihoods] 'Guksu, Salt, Eggs' on Common Tables Rise the Most

Comprehensive Survey of 401 Core Price Items

Eggs are being sold at a large supermarket in Seoul. Photo by Mun Ho-nam munonam@

[Asia Economy Sejong=Reporter Son Seon-hee] Inflation, which has spread comprehensively since the second half of last year, is analyzed to have established itself as a structural trend rather than a temporary phenomenon. The global supply chain bottlenecks deepened after the COVID-19 pandemic triggered increases in the prices of basic grains and raw materials, which then spread to various processed foods, durable goods prices, and even personal service costs such as insurance services, becoming part of everyday life. To make matters worse, recent geopolitical risks due to the Ukraine situation are expected to further intensify upward pressure on prices for the time being.

On the 2nd, an analysis of all 401 items surveyed in Statistics Korea’s ‘Consumer Price Index excluding agricultural products and petroleum products (core inflation)’ showed that the top three items with the highest price increases over the past two years were noodles (34.9%, based on January 2020 vs. January 2022), salt (34.8%), and eggs (34.1%). Following these were pork (33.9%), oysters (32.8%), sinks (30.8%), and frying powder (30.7%), with a total of seven items showing a high inflation rate in the 30% range. Other items with significant price increases included glass noodles (25.2%), imported beef (24.8%), and cooking oil (23.8%).

Besides food products, price increases in durable goods and personal services were also notable. In addition to sinks, durable goods such as bicycles (22%), electric ranges (21.4%), air purifiers (19.5%), and boilers (17.5%) ranked high in inflation rates. Furthermore, personal service items excluding dining out, such as movie ticket prices (23%), insurance service fees (22.4%), and domestic group travel expenses (18.8%), all rose simultaneously.

The core consumer price index is an indicator that surveys only items excluding seasonal and temporary factors like agricultural products or petroleum. The fact that many items have shown a steep price increase in the 30% range in just two years is a warning that this should not be seen as merely a temporary trend. Especially, the trend shows price increases not only in basic food ingredients but also in various durable goods and personal service prices driven by wage hikes.

The recently erupted Russia-Ukraine war is expected to further push up the prices of wheat and corn, which were already on an upward trend. According to the Chicago Board of Trade (CBOT), the international grain futures price index (2015=100) recorded 162.1 in February, a sharp 7% increase compared to just one month earlier. According to the report, Russia and Ukraine are major producers and exporters of wheat, accounting for 14% of global production (June 2021?May 2022) (Russia 9.7%, Ukraine 4.3%) and 28.5% of global exports (Russia 16.9%, Ukraine 11.6%). In particular, Ukraine is a major corn exporter, accounting for 16.4% of global corn exports, ranking as the world’s 4th largest corn exporter by export share.

Kim Ji-yeon, head of the Overseas Agriculture Monitoring Team at the Korea Rural Economic Institute, said, "The Black Sea region holds a large share of the global export market, and with concerns over global grain supply and demand, the intensification of the Russia-Ukraine conflict is expected to expand the rise in international grain prices." She added, "The disruption of natural gas supply, Russia’s main export product, will lead to higher fertilizer prices, which will have direct and indirect effects on the international grain market."

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