South Korea’s consumer prices in the third quarter rise as the pandemic disrupts supply chains and pushed up the prices of agricultural goods.
According to data from the Bank of Korea, prices are rising for ramyeon, milk, and other everyday foods and drinks. Consumer prices rose 2.6 percent from the same period last year, marking the steepest on-year increase in nine years.
According to reports, Kyochon F&B, the country’s No. 1 fried chicken franchise felt the rising prices impact as it raised the price of its chicken items by an average of 8.1 percent for the first time in seven years.
Following the price increase, the brand’s flagship Honey Combo Chicken will now cost 20,000 won ($16.85) instead of 18,000 won.
As canola oil and fish prices rose by more than 50 percent, Dongwon F&B also gave in to the economic situation and had to increase its canned tuna prices by an average of 6.4 percent.
Inflation has hit worldwide, as Dutch beer maker Heineken decided to stop offering the typical convenience store deal of four cans for 10,000 won last week, due to high oil prices and logistics costs.
In the similar trend, the country’s rice wine maker Kooksoondang mentioned that it would raise the prices of its products by up to 25 percent as rice becomes more expensive due to a blockage in the global supply chain.
According to experts, food production prices rose due to supply mismatch that have been triggered by the pandemic. And the high inflation is likely to continue until the end of the year, causing a concern especially for lower earners.
Yonsei University economics professor Sung Tae-yoon commented that the output of food commodities fell because the pandemic disrupted supply chains and increased labor costs. While demand on the other hand rose as pandemic restrictions eased and the market overflowed with liquidity.
According to a Rome-based Food and Agriculture Organization’s food price index, which tracks international prices of globally traded food commodities, was recorded at an average of 133.2 in October, up from 22.6 percent late last year.