Value context and insight. lkm@koreatimes.co.kr
Rising food prices trouble households
Statistics Korea official Ahn Hyung-joon speaks during a briefing at the Sejong Government Complex, Tuesday. Yonhap
By Lee Kyung-min
By Lee Kyung-min
A mother of two children, surnamed Park, is afraid to go grocery shopping, as the prices of most agricultural produce have jumped sharply.
“Almost all food prices have increased,” she said. “I thought having meals at home instead of eating out due to the COVID-19 pandemic seemed an economical choice, but not so much now that the grocery prices are far higher.”
The concern largely shared by many families results from the consumer price of agricultural produce spiking 13.5 percent in September year-on-year, driven by a 34.7 percent year-on-year increase in vegetable prices. Meat and fisheries produce jumped 7.3 percent and 6 percent, respectively.
According to Statistics Korea, the September increase of 13.5 percent was the highest jump in nine and a half years after March 2011 when the figure was 14.6 percent.
The agency said the consumer prices inched up 1 percent last month compared to a year earlier, a recovery that came six months after it stayed below the 1 percent level since April.
This puts a halt ― albeit temporarily ― to months-long chronic low prices associated with what economists term “anemic economic activities” already under strain due to the pandemic.
The recovery of the 1-percent year-on-year increase came despite weeks-long heavy rainfall-induced agricultural produce price hikes. Petro- and refinery-related goods dropped 12 percent due to the lowered crude oil price, with the price of industrial products subsequently declining 0.7 percent. Overall utility prices including electricity, water and liquefied natural gas slid 4.1 percent, year-on-year.
“Overall consumer prices stayed low due to the reduced price of petro-related products and menu items at eateries following stricter social distancing rules,” Statistics Korea official Ahn Hyung-joon said.
“The September prices were mostly affected by the unprecedented rainfall that began in late summer and continued for weeks, as well as a base effect from last year.”
The data showed housing prices soared 0.4 percent from a year earlier, the highest since August 2018 when the figure was 0.5 percent.
Jeonse price increased 0.5 percent, the highest since 0.6 percent reported in February 2019, while monthly rent jumped 0.3 percent, hitting a nearly four-year high since 0.4 percent in November 2016. Unique to Korea, jeonse is a home renting system whereby tenants pay a lump-sum refundable deposit in lieu of monthly rent.
Korea Appraisal Board data showed that the nationwide jeonse price rose 0.53 percent in September, extending the uptrend for the past 12 consecutive months.
The September figure was the sharpest hike in five years and five months, led by a significant drop in jeonse transactions following a revised law that strengthens protection of tenants.
The revision prompted home owners to either jack up the jeonse deposit or altogether refuse to put their homes up for jeonse in the market rather opting for monthly rental fees.
The combined average figure for Seoul, Gyeonggi Province and Incheon rose 0.65 percent, hitting a five-year high.