Moon has long championed engagement with Pyongyang and used the South's 2018 Winter Olympics to build a diplomatic rapprochement that climaxed with the first landmark summit between Kim and US President Donald Trump in Singapore.

But negotiations have been deadlocked since their second summit collapsed in Hanoi last year over sanctions relief and what the North would be willing to give up in return.

Pyongyang has since ended its moratorium on nuclear and intercontinental ballistic missile tests and says it will not return to talks unless Washington first meets all its demands in full.

It has also suspended virtually all inter-Korean cooperation and said it had "nothing to talk" about anymore with Seoul.

"It is clear there is a lull in talks," Moon acknowledged in his annual New Year press conference. "Since a prolonged lull in dialogue can set back the situation, it is not desirable."

The two sides did not have "much time to spare", he added: "Once a full-scale presidential race begins, it may not be easy for the US to make time for talks with North Korea."

But despite the stand-off, he insisted that further discussions were still possible.

"North Korea is showing that it is leaving the door to dialogue open and that it wants to talk."