- Korea’s October exports hit second highest on record 2018-11-01
The Ministry of Trade, Industry and Energy announced on November 1 that Korea’s exports in October rose 22.7 percent year-on-year to USD 55 billion, the second highest on record.
This achievement was possible because of both internal and external factors. The internal factors include the Korean firms’ pursuit of manufacturing high value products, diversification of exports items, and balanced growth of exports to foreign destinations. The external factors are strong manufacturing industries across the globe and increased prices of oil as well as major export items.
Average daily exports decreased 4 percent to $2.4 billion due to a high base effect, but they were the third highest on record. Meanwhile, won-denominated exports increased 22.6 percent to 62.2 trillion won.
Imports turned to growth this month, advancing 27.9 percent to $48.4 billion. As a result, Korea remained as a net exporter for 81 consecutive months with a trade surplus of $6.6 billion.
Trade, Industry and Energy Minister Sung Yunmo stated that despite the ongoing trade dispute between the U.S. and China and increased volatility in global financial markets, Korean exports in October surged to the second highest level. Minister Sung also said that exports exceeded $50 billion for six straight months for the first time ever and that it took the shortest amount of time for cumulative exports to surpass the $500 billion mark in a year.
According to Minister Sung, the Ministry plans to sustain the country’s robust exports growth by actively responding to rising global trade protectionism, improving industry policies for job creation and innovation-driven growth, and diversifying export markets and items.
A rundown of exports shows that ten out of Korea’s 13 major export items posted growth. They are semiconductors, general machinery, petrochemicals, petroleum products, automobiles, auto parts, textiles, steel, computers, and home appliances. Exports of the first eight categories grew at double-digit rates.
Exports of semiconductors jumped 22.2 percent year-on-year to the second highest record of $11.6 billion, staying above the $10 billion mark for the sixth consecutive month. In addition, annual chip exports topped $100 billion in October, which is an unprecedented accomplishment. While the unit price of semiconductors decreased due to greater supply, the increased memory capacity of tech devices and higher demand for data servers contributed to the growth.
Outbound shipments of general machinery soared 51.7 percent to a record high of $5.0 billion. Healthy construction and manufacturing industries in export destinations led to this expansion. Exports to China, the U.S., the EU, and India were particularly on the rise.
Overseas sales of petrochemicals also recorded an all-time high of $4.5 billion, up 42.9 percent from the same period last year. This is attributable to the higher unit price of petrochemical products caused by higher oil prices and increased production from extended facilities.
On the contrary, exports of displays, wireless communication devices, and ships decreased.
Display exports dropped 7.9 percent to $2.3 billion because of falling liquid crystal display (LCD) prices and shipments. This was despite the fact that sales conditions for organic light-emitting diode (OLED) panels remained favorable due to newly introduced smartphone models and greater demand for televisions.
The value of wireless communication devices shipped abroad slipped 18.2 percent to $1.7 billion because of increased overseas production and longer smartphone replacement cycles.
Outbound shipments of ships decreased 55 percent to $1.5 billion mainly because of a high base effect and fewer shipbuilding orders.
By region, exports to every destination except for the Middle East saw growth.
Exports to China went up 17.7 percent to $14.8 billion, achieving the 24th consecutive monthly growth. The leading export items were general machinery, petrochemicals, petroleum products, steel, and semiconductors.
The value of Korean goods shipped to the Association of Southeast Asian Nations (ASEAN) rose 19.2 percent to $8.8 billion, the second highest on record. Exports to the region were led by semiconductors, petroleum products, and general machinery.
Outbound shipments to the Middle East, on the other hand, decreased 3.9 percent to $1.6 billion. While exports of automobiles, petrochemicals, and steel expanded, those of general machinery, textiles, and home appliances contracted.
As for imports, inbound shipments of crude oil and liquefied natural gas went up 54.1 percent and 89.3 percent, respectively, due to rising oil prices.