With the Middle East war driving up international oil prices and the won-dollar exchange rate at the same time, the overall prices of imported products in Korea rose more than 16%, data showed. This increase is the largest since January 1998 (23.2%).
According to export and import price index statistics that the Bank of Korea released on the 15th, the import price index for March (won-based preliminary, 2020=100) was 169.38. It rose 16.1% from February (145.88). It is the largest increase in 28 years and 2 months.
Among materials and supplies, crude oil jumped 88.5% from the previous month. That is the highest growth rate since 1985, when crude oil was first included in the tally. Among other key items, butadiene (70.6%), a raw material for synthetic rubber, jet fuel (67.1%) and naphtha (46.1%) led the rise in import prices.
On the level of the import price index next month, Lee Moon-hee, prices statistics team head at the Bank of Korea (BOK), said, "Uncertainty over negotiations between the United States and Iran is very high," adding, "Given that it will be difficult to fully resolve raw material supply disruptions for the time being, it is hard to predict the direction."
The export price index for March (won-based) was also tallied at 173.86, up 16.3% from the previous month (149.5). This too is the largest increase since January 1998 (17.8%). Diesel (120.7%), jet fuel (93.6%) and ethylene (85.8%) mainly pushed up export prices.
The net barter terms of trade index (113.69) rose 22.8% from a year earlier, as export prices increased more than import prices. This index is the ratio of the price per unit of export goods to the price per unit of import goods, and an increase in this index means Korea's terms of trade improved.
The income terms of trade index (168.61), which measures the ability to increase imports based on export aggregates, also rose 50.9% over the same period. An increase in this index likewise means Korea's terms of trade improved.