Producer Prices Rise for 5 Consecutive Months as Prices of Semiconductors and Other Manufactured Goods Increase

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The Producer Price Index (PPI) continued its upward trend for the fifth consecutive month as prices of manufactured goods such as semiconductors rose. Meanwhile, prices of agricultural, forestry, and fishery products, which had sharply increased, turned to a downward trend.

According to the "April 2024 Producer Price Index (Preliminary)" released by the Bank of Korea on the 22nd, the PPI in April rose by 0.3% compared to the previous month. Compared to the same month last year, it increased by 1.8%.

The PPI decreased in October (-0.1%) and November (-0.4%) of last year compared to the previous month, then rose in December (0.1%), January (0.5%), February (0.3%), March (0.2%), and April (0.3%) of this year, showing an upward trend for five consecutive months.

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Looking in detail, manufactured goods and services increased, while agricultural, forestry, and fishery products, as well as electricity, gas, water, and waste, decreased compared to the previous month.

Manufactured goods rose by 0.7% month-on-month, driven by increases in computers, electronic and optical equipment (1.8%), primary metal products (1.5%), and coal and petroleum products (1.7%).

By item, within manufactured goods, computers, electronic and optical equipment saw significant increases in DRAM (16.4%) and flash memory (11.4%) compared to the previous month. Coal and petroleum products rose with gasoline (7.5%) and kerosene (2.3%) increasing.

Services rose by 0.2% month-on-month, led by restaurant and accommodation services (0.3%) and transportation services (0.2%).

Agricultural, forestry, and fishery products, which had shown a strong rise in the previous month, fell by 3% month-on-month due to decreases in agricultural products (-4.9%) and fishery products (-4.2%). By item, prices of green chili peppers (-47.4%) and cucumbers (-44.2%) among agricultural products declined, and mackerel (-41.5%) prices among fishery products dropped.

Yuseong Wook, head of the Price Statistics Team at the Economic Statistics Bureau of the Bank of Korea, explained, "Prices of vegetables such as green chili peppers and cucumbers fell due to improved growing conditions and increased shipment volumes. Agricultural, forestry, and fishery products are greatly influenced by climatic conditions, making it difficult to predict future trends."

Electricity, gas, water, and waste decreased by 0.6% month-on-month, with industrial city gas falling by 7.3%.

By special classification, food products fell by 1.1% month-on-month, and fresh food dropped by 7.5%. Energy rose by 0.1%, and IT increased by 1.2%. Excluding food products and energy, prices rose by 0.4%.

The Domestic Supply Price Index, which combines the Producer Price Index and Import Price Index, rose by 1% month-on-month as raw materials (2.6%), intermediate goods (1%), and final goods (0.5%) all increased due to rising oil prices and exchange rates.

The Total Output Price Index, combining the Producer Price Index and Export Price Index, rose by 1.2% month-on-month as manufactured goods (2.0%) and services (0.2%) increased despite a decline in agricultural, forestry, and fishery products (-2.9%).

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