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Korea’s exports fall 24.3 percent to $36.9 billion in April 2020-05-01

The Ministry of Trade, Industry and Energy announced on May 1 that Korea’s exports in April fell 24.3 percent compared to the same period a year earlier to USD 36.9 billion. Imports also dropped 15.9 percent to $37.9 billion, resulting in a trade deficit of $950 million.

Exports in April decreased significantly with the coronavirus pandemic in full swing. The decrease was led by a sharp drop in demand in major regions such as the U.S. and the EU coupled with plunging oil prices. Also, there were two fewer working days in April and the exports in April 2019 had reached one of the highest last year, so this contributed to the fall in exports.

The drop in exports was mainly due to the decrease in unit prices (down 15.0 percent) and the daily average export volume adjusted for working days variation went down only 2.9 percent.

The Ministry forecasts that Korea’s exports will be able to rebound soon. Korea is attracting global attention as a safe and stable production base, and the trade deficit in April was largely caused by a bigger drop in exports compared to drop in imports as imports of capital and intermediate goods continued while the manufacturing industry kept operating under normal conditions.

Outbound shipments of all items saw decreases except for plastics, bio-health products, and computers. Semiconductors, general machinery, petrochemicals, automobiles, steels, petroleum products, ships, auto parts, displays, wireless communication devices, textiles, agricultural products and fisheries, cosmetics, secondary batteries, fine chemical materials, home appliances, and robots fell in exports.

Outbound shipments of computers spiked 99.3 percent to $1.1 billion. More people worked from home due to the virus lockdowns, and online education became more widespread. Stronger demand for solid-state devices (SSDs) also contributed to the jump in exports.

Bio-health products improved 29.0 percent to $1.1 billion thanks to favorable sales of Korean quarantine products including the coronavirus diagnostic kits in the ASEAN, the EU, and the U.S. markets.

Automobile exports contracted 36.3 percent to $2.4 billion primarily because of lockdowns in the U.S. and Europe as well as auto dealership shutdowns overseas.

Petrochemical exports fell 33.6 percent to $2.6 billion as a result of shutdowns at the automobile and home appliance industries and falling oil prices.

Secondary batteries decreased 10.7 percent to $570 million. Despite increases in Energy Storage System (ESS) exports, shutdowns of Korean companies in the U.S. and shutdowns at major electric vehicle plants in Europe attributed to the contraction.

By region, outbound shipments to all regions went down.

Exports to the U.S. shrank 13.5 percent to $5.3 billion as a result of lower sales of automobiles, general machinery, wireless communication devices, and home appliances.

China went down 17.9 percent to $10.2 billion due to petrochemicals, general machinery, displays and petroleum products.

Outbound shipments to ASEAN dropped 32.9 percent to $5.7 billion on semiconductors, general machinery, displays, and petroleum products.

Those to the EU fell 12.8 percent to $4.3 billion on automobiles, general machinery, petrochemicals, and steel products.

Exports to the Middle East went down 20.7 percent to $1.3 billion, led by petrochemicals, steel products, auto parts, and textiles.

Those to Japan contracted 12.0 percent to $2.0 billion, due to weaker demand in general machinery, petrochemicals, petroleum products, and semiconductors.

Korean goods shipped to India also fell 59.7 percent to $530 million. Reduced sales of steels, general machinery, auto parts, and petrochemicals led to the contraction.

Exports to the CIS shrank 42.0 percent to $660 million on automobiles, general machinery, steel products, and textiles.

Central and South America saw a 54.2 percent decrease to $1.4 billion, General machinery, steel, auto parts, and petrochemicals contributed to this drop.

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