Consumers complain over rising prices

By Yoon Ja-young

Choi Yun-jeong, a housewife in Yongsan, downtown Seoul, is puzzled by news reports that the government is concerned about deflation. “When I go to the grocery store, I find everything so expensive. With 10,000 won, you can buy only a handful of onions,” she said.

Statistics Korea reported that consumer prices rose only 0.7 percent this year, marking the lowest inflation ever, but it seems that consumers ― especially housewives ― don’t agree.

According to a survey of 3,312 households by the Korea Rural Economic Institute (KREI), 38.5 percent of respondents said their spending on food increased this year compared with the previous year. Slightly over half of the households said their spending was similar to the previous year while only 7.5 percent said they spent less.

When asked by how much they think food prices have risen, the answer was an average 12.2 percent. It is true that consumers tend to perceive inflation as higher than it really is, but it still is too large a gap when compared with the actual consumer prices rise of 0.7 percent announced by the government.

Analysts explain that this gap of perception is due to the fact that the government’s consumer price index includes items that not every household buys often. According to the Korea Agro-Fisheries and Food Trade Corp (aT), onions were traded at double the price of the previous year. The price of garlic also soared nearly 50 percent from the year before.

Analysts point out that price fluctuations decrease consumer benefits. “There should be a supply channel secured from overseas for fresh food so that it can be imported in case of weather damage,” said Kim Chun-gu, a researcher at Hyundai Research Institute.

“There should also be more investment to develop technology for better storage of fresh foods, so that the supply can be controlled more elastically,” he added.

The survey by KREI also showed that 40.3 percent of households buy food once a week, while 38.4 percent do two or three times a week.

It also reflected decreasing rice consumption by Koreans. Around half of respondents said they buy rice once every two or three months, while only 16.5 percent said they buy rice once or twice every month. In the case of fruit and vegetables, most households bought them once a week. The institute added that those with a higher income and a higher level of education tend to buy fruits and vegetables more frequently.

The ratio of those shunning U.S. beef is also decreasing, from 48.1 percent in 2013 to 42.4 percent in 2015. Some consumers have been refraining from buying U.S. beef following the mad cow disease scare in 2008.