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Trade surplus in industrial materials, components exports set record $30.8 billion in Q1 2018-04-19

The Ministry of Trade, Industry and Energy announced on April 19 that trade surplus in industrial materials and components in the first quarter of 2018 set a record USD 30.8 billion.
Exports of 11 types of materials and components rose 13.3 percent year-on-year to $74.4 billion, the second highest value of all-time. Exports of both materials and components achieved double-digit growths of 14.0 percent and 13.0 percent, respectively.

Imports in this sector grew to $43.6 billion, up 8.2 percent from the same period of 2017.

Since 2002, statistics on the Korean materials and components industry have been produced based on the eighth edition of the Korean Standard Statistical Classification (KSIC) which classifies items into 12 major categories (five materials and seven components). In the meantime, the KSIC has been updated to the 10th edition after two revisions (once in 2008 and again in 2017). To reflect this change, the Ministry revised its classification for statistics on materials and components.

Among the previous 12 major categories, the five materials (textiles, chemical products, rubber and plastics, non-metallic minerals, primary metals) remained the same while the seven components (fabricated metals, general machinery components, computer and office equipment components, electromechanical components, electronic components, precision instrument components, and transport machinery components) were reduced to six (processed metals, general machinery components, electrical equipment components, electronic components, precision instrument components, and transport machinery components).

A breakdown of exports showed that outbound shipments of electronic components and chemical products led growth as they jumped 24.8 percent to $31.3 billion and 15.6 percent to $12.2 billion, respectively. Memory semiconductors were particularly in strong demand: sophistication of information technology devices increased demand for NAND flash memory chips and greater need for servers created larger demand for dynamic random access memory (DRAM) chips.

Exports of primary metals also saw growth, up 16.7 percent to $6.9 billion. Higher international steel prices were largely responsible for this increase.

Meanwhile, exports of transport machinery components went down 12.0 percent to $6.5 billion. This decline is primarily due to sluggish sales of finished Korean cars in key economies such as the U.S. and China that resulted a fall in production at Korean automakers’ plants in those countries.

By region, exports to all major markets except Central and South America and the Middle East increased from a year earlier.

Exports to China were bigger than those to any other export partner country, increasing 18.5 percent to $23.7 billion. This growth was largely attributable to greater demand for electronic components, especially semiconductors used for big data projects and the Internet of Things.

Outbound shipments to the Association of Southeast Asian Nations (ASEAN) expanded 10.6 percent to $12.6 billion mostly due to increased demand for electronic components, particularly semiconductors.

Exports to Europe went up 25.3 percent to $9.4 billion because of increases in all categories for both materials and components. The increase in materials exports was led by chemical products, and that in components exports by electronic components and general machinery components.

The growth in imports was led by electronic components (up 11.4 percent to $14.5 billion), chemical products (up 12.4 percent to $7.7 billion), and general machinery components (up 14.7 percent to $5.1 billion).

Meanwhile, this expansion was partially offset by primary metals (down 0.9 percent to $5.7 billion and transport machinery components (down 2.1 percent to $2.6 billion).

Regionally, imports from all major markets increased. In particular, imports from China rose 9.2 percent to $12.8 billion and those from ASEAN grew 13.9 percent to $5.0 billion.

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