South Korea’s producer prices contracted for the third straight month in April upon record crashes in coal and petroleum produces.

According to Bank of Korea on Thursday, Korea’s producer price index (PPI) fell 0.7 percent to 102.08 in April from a month ago, the third month in the negative against the previous month. The PPI was down 1.5 percent against a year-ago period, marking an on-year decline for two consecutive months.

PPI refers to the wholesale cost of goods and services and influences later inflation.

The global oil price crash from virus-battered oil demand mainly drove down overall costs for producers last month, the central bank said.

Dubai crude prices, the country’s benchmark that makes up nearly 85 percent of total oil imports, averaged $20.39 per barrel in April, down from $33.71 a month earlier.

As a result, coal and petroleum products prices lost 22.6 percent on month and 43.5 percent on year in April, marking the biggest falls against the previous month and year since data compiling from January 1965.

Chemical products prices slid 2.2 percent on month, but DRAM prices jumped 7.4 percent.

Prices of agricultural, livestock and fishery products rose 0.2 percent on increased demand from home-cooked meals amid social distancing. Pork prices gained 9.9 percent and beef up 6.3 percent. But pumpkin prices plunged 48.6 percent and cucumber down 38.4 percent.

Service prices remained unchanged from the previous month, led by a rise in financial/insurance and transportation costs. Prices of air freight surged 12.2 percent.

Domestic supplier index, which includes prices of imported goods, retreated 2.1 percent on month and 2.9 percent on year. Raw material prices slipped 14.6 percent on month and intermediary goods 1.6 percent.

The total output price index, which includes exports, shriveled 1.0 percent on month and 2.3 percent on year.

By Lee Ha-yeon

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