SEOUL, January 20 (AJP) - Food and beverage companies are responding to soaring raw material costs with a wave of price increases across popular products, creating fresh challenges for consumers already grappling with rising inflation.
Paul Bassett, a premium coffee chain, announced a 3.4 percent price hike on 28 menu items, effective Jan. 23.
Dong-A Pharmaceutical plans to raise the price of its Bacchus energy drinks by as much as 11.1 percent in March. Similarly, Dongah Otsuka has already increased beverage prices by an average of 6.3 percent this year, while Daesang raised prices for mayonnaise and sauces by 9 to 23.4 percent starting Jan. 16. Ottogi has also implemented a 10 percent increase on its business-use strawberry jam.
The price hikes come amid a significant rise in raw material costs. Retail strawberry prices, for example, have surged 22.7 percent year-on-year as of Jan. 17, while the cost of flour products jumped between 100 and 124 percent by mid-December.
Prices for cabbage and radish, staples in many Korean dishes, have skyrocketed by 68 percent and 90 percent, respectively, according to the Korea Agro-Fisheries & Food Trade Corporation.
Currency fluctuations have added to the strain, impacting companies reliant on imported goods. Coffee prices have been particularly affected, with the coffee import price index soaring 91.3 percent year-on-year in November. As a result, Dongsuh Food raised instant coffee prices by 8.9 percent.
The broader impact is reflected in the consumer price index for agricultural, livestock, and fishery products, which rose 2.6 percent year-on-year in December.
This outpaced the overall consumer price increase of 1.9 percent, according to Statistics Korea, as political uncertainty triggered by President Yoon Suk Yeol's martial law decree continues to weigh on the nation’s economy.
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