The Bank of Korea Announces May Trade Index and Terms of Trade
Container unloading operations are underway at Busan Port's Sinsundae and Gammam Wharf. [Image source=Yonhap News]
Due to the global rise in raw material prices, the domestic import value index has increased for 18 consecutive months. The net barter terms of trade index, which indicates the quantity of goods that can be imported per unit of export, continued its decline for 14 consecutive months.
According to the 'May Trade Index and Terms of Trade' released by the Bank of Korea on the 29th, last month's import value index stood at 176.50, soaring 32% compared to the same month last year. This marked the highest growth rate since January (34.4%) and continued the upward trend for 18 consecutive months.
The import value index decreased only in transport equipment (-6.4%) but rose in mining products (75.7%), primary metal products (42.1%), and coal and petroleum products (40.6%).
The import volume index rose 6.2% year-on-year to 128.08, turning upward after two months. Although coal and petroleum products (-12.9%) declined, computers, electronics, and optical equipment (22.9%) and chemical products (2%) increased.
The export value index was 146.81, up 19.9% year-on-year, marking 19 consecutive months of growth. Most categories increased, including coal and petroleum products (103.5%), transport equipment (15.1%), chemical products (21.5%), and primary metal products (20.4%).
The export volume index recorded 124.86, also rising 7.9% year-on-year. This marks eight consecutive months of growth.
The net barter terms of trade index for May fell 10.6% year-on-year as import prices (24.3%) rose more than export prices (11.1%). The net barter terms of trade index slightly increased to 85.33 in May after hitting a record low in April.
The net barter terms of trade index is the ratio between the price of one unit of export goods and one unit of import goods, indicating the quantity of goods South Korea can import per unit of export.
The income terms of trade index, which represents the total quantity of goods that can be imported with South Korea's total export value, fell 3.6% year-on-year to 106.54, declining for four consecutive months. The Bank of Korea explained, "Although the export volume index rose (7.9%), the net barter terms of trade index declined (-10.6%)."
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