Import prices in April fell 2.3% from the previous month, the Bank of Korea said on the 15th. After rising from July last year through March this year, they turned downward for the first time in 10 months. The drop was driven by a 17.8% decline in Dubai crude, from an average of $128.52 per barrel in March to $105.7 in April.
According to the Bank of Korea's Export and Import Price Index and Trade Index, April import prices rose 20.2% from a year earlier. They remained elevated after March's 20.4%. The increase came as the price of Dubai crude rose 56% from a year earlier due to the aftermath of the Middle East war.
Export prices in April rose 7.1% from the previous month. They were also up 40.8% from a year earlier. The export price index (187.4) is the highest in 28 years and 1 month since March 1998 (196.01). As global demand for semiconductors expanded, prices of memory chips, a key export item, jumped. Prices of computer, electronic, and optical equipment exports also hit a record high for the first time in 15 years and 8 months since August 2010. In particular, DRAM prices rose 25% from the previous month and 232.8% from a year earlier.
On a contract currency basis excluding exchange-rate effects, export prices rose 7.1% from the previous month and 40.8% from a year earlier. Export corporations benefit when the won-dollar exchange rate against the U.S. dollar is higher. The won-dollar rate inched up from an average of 1,486.64 won in March to 1,487.39 won in April.
A Bank of Korea official said the decline in import prices was driven most by lower global oil prices and noted that the heavier weight of semiconductors in exports had a strong upward effect on export prices.
The export volume index, which shows how many products were exported compared with the past, rose 12.4% from a year earlier. The export value index, which shows how expensively goods were sold, rose 50.2% in the same period. By contrast, the import volume index fell 0.1% as coal and petroleum products decreased, but the import value index rose 16.8%.
The net barter terms of trade index, which represents the quantity of imports obtainable per unit of exports, rose 14.3% from a year earlier. This means Korea can import more goods even if it exports the same quantity as in the past. The result came as export prices rose 33.6% in the period, outpacing import prices (16.9%). The income terms of trade index, an indicator measuring the capacity to increase imports with export revenue, rose 28.5% from a year earlier.