"Winter Fruit Prices Surge and Semiconductor Costs Rise"... Producer Price Index Up for Fourth Consecutive Month

Bank of Korea's "December 2025 Producer Price Index"
Semiconductor Prices Remain High as Winter Agricultural Product Prices Surge

The producer price index has risen for the fourth consecutive month. This continued upward trend in prices is attributed to strong demand for semiconductors, as well as a surge in the prices of agricultural products such as winter fruits.

According to the "Producer Price Index (Preliminary) for December 2025" released by the Bank of Korea on January 20, the producer price index for December 2025 stood at 121.76 (2020=100), up 0.4% from the previous month. This marks four consecutive months of increases since September. Compared to the same period last year, the index also rose by 1.9%.

By item, agricultural, forestry, and fishery products led the rise in producer prices. These products increased by 3.5% from the previous month, driven by a 5.8% rise in agricultural products and a 1.3% increase in livestock products. In particular, agricultural products shifted to an upward trend in just one month, from a -2.3% decrease in November 2025. Compared to the same month last year, agricultural products rose by 7.5%.

Lee Moonhee, Head of the Price Statistics Team 1 at the Economic Statistics Department of the Bank of Korea, explained, "In addition to seasonal supply and demand fluctuations, the delayed harvest of certain fruit items caused temporary supply disruptions." In fact, among agricultural products, apple prices rose by 19.8% from the previous month. The price of tangerines, a typical winter fruit, also jumped by 12.9%.

However, Lee added, "It is not unusual for agricultural products to show month-on-month increases during the summer and winter, so this upward trend is not unprecedented. The year-on-year increase is also partly due to differences in the shipping periods and supply-demand conditions for each item, which have led to varying trends by product."

Seoul Dongdaemun-gu Cheongnyangni Agricultural and Marine Products Market is showing a quiet scene. Photo by Kang Jin-hyung

Manufactured goods rose by 0.4% from the previous month. In December 2025, semiconductor prices surged, leading to a 2.3% increase in computers, electronics, and optical devices from the previous month. Primary metal products also rose by 1.1% during the same period.

Electricity, gas, water, and waste services rose by 0.2% from the previous month, driven by a 1.6% increase in industrial city gas and a 2.3% rise in sewage treatment. The service sector rose by 0.2% over the same period, mainly due to a 0.4% increase in restaurant and accommodation services and a 0.7% rise in financial and insurance services.

The producer price index for 2025 rose by 1.2% compared to the previous year.

Despite four consecutive months of increases in producer prices, some point out that the impact on consumer prices may be limited.

Lee explained, "The consumer price index is mainly compiled based on consumer goods purchased by households, whereas the producer price index includes raw materials, intermediate goods, and capital goods, so the scope and the basis for price surveys differ, which can lead to different trends. While overall trends may be similar, the timing of reflection in consumer prices, companies' pricing policies in response to market competition, and government price stabilization policies can all cause consumer price trends to diverge."

He continued, "In particular, the recent rise in producer prices is due to increases in the prices of intermediate goods such as semiconductors, so there may be a time lag before this affects consumer prices. In addition, international oil prices are still declining on a monthly average basis, and these changes in conditions could also affect consumer prices, especially for petroleum products."

In December 2025, the domestic supply price index rose by 0.4% from the previous month and by 1.3% compared to the same month last year. The domestic supply price index measures price fluctuations of goods and services supplied domestically (including both domestic shipments and imports) to analyze the transmission of price changes. By production stage, prices for raw materials (up 1.8%), intermediate goods (up 0.4%), and final goods (up 0.2%) all increased.

The total output price index, which adds exports to domestic shipments, also rose by 0.4% from the previous month. This was due to increases in manufactured goods (up 0.5%) and agricultural, forestry, and fishery products (up 3.2%). Compared to the same month last year, the index rose by 2.6%.