An index gauging producer prices stood at 129.39, down 0.4 percent from June but up 7.7 percent from a year earlier, marking the first month-on-month decline since August last year.
The annual increase also slowed for a second straight month from 8.6 percent in May and a revised 8.5 percent in June.
The easing was even more pronounced in prices of goods entering the domestic supply chain, as the relevant index, which includes imported and domestically produced goods and services, fell 1.8 percent from June.
Raw-material prices fell 7.7 percent, while intermediate and final goods declined 1.7 percent and 0.2 percent, respectively. Imported raw materials plunged 9.6 percent and imported intermediate goods dropped 6.1 percent.
The BOK said customs-cleared import prices reflected a 23.0 percent month-on-month fall in dollar-denominated Dubai crude in June, along with the stronger won and lags between contracts and customs clearance.
The decline in global oil prices also fed directly into domestic producer costs.
Manufactured-goods prices fell 0.5 percent from June, led by a 5.1 percent decline in coal and petroleum products and a 1.3 percent fall in chemical products.
Gasoline prices dropped 11.3 percent on month and diesel fell 9.8 percent, while polyethylene resin declined 10.2 percent and xylene lost 4.9 percent.
The broader energy index fell 3.6 percent.
Producer prices excluding food and energy, however, slipped just 0.2 percent from June and remained 8.0 percent above their level a year earlier, suggesting that the easing was concentrated in several of the components hit hardest by the earlier energy shock.
Services provided another drag on the overall index. Services prices fell 0.4 percent from June as financial and insurance services dropped 7.1 percent following a decline in share prices.
Brokerage commission prices plunged 16.8 percent on month. The BOK said prices for brokerage services can move with the value of underlying assets because the fees are calculated from transaction values and commission rates.
Brokerage commission prices nevertheless remained 90.8 percent higher than a year earlier.
The export side of the economy showed a markedly different picture. The total output price index, which includes exports alongside goods and services shipped domestically, fell 0.2 percent from June but remained 16.6 percent higher than a year earlier.
The annual increase eased from 17.5 percent in June after rising 16.8 percent in May.
Prices for exports included in the total-output measure were 49.0 percent higher than a year earlier, compared with a 7.7 percent increase for domestic shipments.
Manufactured export prices rose 49.1 percent on year, far outpacing the 12.2 percent gain for manufactured goods sold domestically.
Semiconductors remained at the center of that divergence. Semiconductor producer prices rose 3.7 percent from June and 144.9 percent from a year earlier. DRAM prices gained 8.4 percent on month and surged 474.4 percent on year, while computer memory device prices were 290.7 percent higher than a year earlier.
The split leaves South Korea with an increasingly uneven producer-price picture: lower oil prices and a stronger currency are reducing imported and upstream costs, while the AI-driven semiconductor cycle continues to generate extraordinary price gains in export industries.
Weather added another source of volatility. Agricultural, forestry and fishery prices rose 1.5 percent from June, with agricultural products gaining 2.4 percent.
Spinach prices more than doubled, rising 115.8 percent on month after extreme heat and poor growing conditions, although they remained 29.3 percent lower than a year earlier.
Electricity, gas, water and waste prices moved in the opposite direction, falling 0.6 percent as seasonal easing of South Korea's progressive summer electricity tariff pushed residential electricity prices down 11.8 percent.
AJP Takeaways:
• South Korea's producer prices fell 0.4 percent in July, their first monthly decline in 11 months.
• Falling oil prices and a stronger won pushed domestic supply prices down 1.8 percent as imported raw-material costs plunged.
• Chip prices remained an outlier, with semiconductor prices up 144.9 percent and DRAM prices surging 474.4 percent from a year earlier.
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