February Import Prices Up 1.2%, Export Prices Up 1.4%
Impact of Rising International Oil Prices and Won-Dollar Exchange Rate
Excluding the exchange rate effect, export and import prices based on contract currency last month rose by 0.9% and 0.8% respectively compared to the previous month.
Meanwhile, export prices increased by 4.2% year-on-year, influenced by the exchange rate and increased semiconductor exports. On the other hand, import prices fell by 0.2% year-on-year.
As international oil prices and the KRW-USD exchange rate rose, import prices last month showed an increase for the second consecutive month.
Containers loaded at Busan Port. According to the "February 2024 Export and Import Price Index (Provisional)" released by the Bank of Korea, import prices rose by 1.2% compared to the previous month. The export price index also increased by 1.4% compared to the previous month. [Image source=Yonhap News]
According to the 'February 2024 Export and Import Price Index (Provisional)' released by the Bank of Korea on the 15th, import prices last month rose by 1.2% compared to the previous month. Import prices showed an upward trend for two consecutive months following a 2.5% increase in the previous month.
The rise in import prices was largely influenced by Dubai crude oil prices increasing by 2.6% from an average of $78.85 per barrel in January to $80.88 in February. International oil prices have been on an upward trend this year, pushing up the import price index.
The average KRW-USD exchange rate also rose by 0.6%, from 1,323.57 KRW in January to 1,331.74 KRW in February, affecting import prices. When the dollar strengthens, the prices of imported goods also increase.
Looking at import prices by item, mineral products such as crude oil, bituminous coal, and natural gas rose by 2.6% month-on-month, while coal and petroleum products increased by 1.5%. Import prices affect domestic consumer prices with a time lag.
Yoo Sung-wook, head of the Price Statistics Team at the Bank of Korea’s Economic Statistics Bureau, explained, "Import prices rose mainly in mineral products and chemical products due to the increase in international oil prices and the KRW-USD exchange rate."
Last month, the export price index also rose by 1.4% compared to the previous month, marking two consecutive months of increase since January. The Bank of Korea explained that export prices were also significantly affected by the rise in the KRW-USD exchange rate.
By item, coal and petroleum products rose 3.5% month-on-month, chemical products 1.6%, and computers, electronics, and optical devices 1.5%.
In particular, the export price of flash memory rose by 6.9% compared to the previous month, showing an improvement in the semiconductor industry. Semiconductors have been on an upward trend for seven consecutive months on a month-on-month basis.
Excluding the exchange rate effect, export and import prices based on contract currency last month rose by 0.9% and 0.8% respectively compared to the previous month.
Meanwhile, export prices increased by 4.2% year-on-year, influenced by the exchange rate and increased semiconductor exports. On the other hand, import prices fell by 0.2% year-on-year.
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