North Korean Market Meltdown: How Floods and a Rising Dollar Are Crushing Residents

Inflation in North Korea has surged dramatically, driven by the rising value of the U.S. dollar and stalling flood recovery efforts in the Amnok River region. These challenges have led to significant disruptions in distribution networks.

An analysis by SPN released on Sunday reveals that prices in North Korean markets, including Pyongyang, Hyesan in Yanggang Province, Wonsan in Gangwon Province, and Sariwon in North Hwanghae Province, have continued to climb over the past two weeks.

Looking at grain prices, rice (1 kg or 2.2 lb) costs about $6.9 (6,300 KPW) in Pyongyang (+$0.2 from two weeks ago), $7.3 (6,600 KPW) in Hyesan (+$0.1), $6.8 (6,200 KPW) in Wonsan (+$0.3), and $6.83 (6,150 KPW) in Sariwon (+$0.16), reflecting an increase of 2% to 5%.

The price of corn (1 kg or 2.2 lb) rose to $2.9 (2,700 KPW) in Pyongyang, $3.8 (3,500 KPW) in Hyesan, and $3 (2,710 KPW) in Wonsan (+$0.12).

Cooking oil (1 kg or 2.2 lb) jumped to $21.11 (19,000 KPW) in Pyongyang (+$1.22) and $20.22 (18,200 KPW) in Hyesan (+$1.33), marking a sharp increase of 5% to 7% across regions. Sugar prices also rose, reaching $13.11 (11,800 KPW) in Pyongyang (+$0.6) and $13.33 (12,000 KPW) in Wonsan (+$0.5), with increases of 4% to 7% throughout the areas.

The price of flour (2.2 lb) had once dropped last month due to Russian support, but it has now risen to $9.33 (8,400 KPW) in Pyongyang (+$0.4) and $9.44 (8,500 KPW) in Sariwon (+$0.4), marking an increase of up to 5%.

Gasoline (2.2 lb) prices increased to $18.55 (16,700 KPW) in Pyongyang (+$0.7) and $18.88 (17,000 KPW) in Hyesan, reflecting a rise of about 4.3%. Diesel fuel prices also went up to $16.77 (15,100 KPW) in Pyongyang (+$0.9) and $16.88 (15,200 KPW) in Sariwon, showing an increase of around 6%.

Vegetable prices have soared due to the floods, with napa cabbage (one head) reaching $1.77 (1,600 KPW) in Hyesan (+$0.4) and $1.55 (1,400 KPW) in Sariwon (+$0.4), marking a staggering 40% increase.

The dollar has surged in value due to increased demand for construction materials following the floods and intensified crackdowns, reaching $15.33 (13,800 KPW) in Pyongyang and $13.33 (12,000 KPW) in Hyesan, marking a significant rise of 7% to 10%.

Local sources report that residents are struggling as grain prices continue to rise despite previous stabilization or declines due to potato and barley harvests in June and July. Additionally, delays in flood recovery along the Amnok River have hindered freight train operations between China’s Dandong and North Korea’s Sinuiju. Train and vehicle operations remain suspended in some areas of Pyongan and Jagang provinces, severely impacting the distribution network. Sources indicate that the rising dollar exchange rate is a significant factor driving the price increase.