South Korea's August Exports: A Deep Dive into the 8.4% Decline

Philip Lee -

Seoul, South Korea - South Korea's exports plunged in August, falling 8.4% from a year earlier.

The Key Figures

  • South Korea's August exports: Down 8.4% y/y to $51.9 billion.
  • Imports for the same period: Down 22.8% to $51.0 billion.
  • Result: Trade surplus of $0.9 billion.

Primary reasons for export decline:

  • Lower unit prices for semiconductors, petroleum, and petrochemicals.
  • The high base of comparison from record high exports last August: $56.6 billion.
  • Notably, the rate of decline is now in the single digits, showing month-over-month improvement.

Analysis of import numbers:

  • Significant declines in crude oil, natural gas, coal, and other energy sources.
  • Continued declines in imports of semiconductors, related equipment, and steel.

Deep Dive per Items

  • Semiconductors: A decline of 20.6%, mainly due to a 49.6% drop in memory chip exports. Potential recovery forecast due to increasing demand for DDR5 and HBM.
  • Automotive: Up 28.7%. Electric vehicles surged 66%, accounting for 23% of total automobile exports.
  • Machinery: Up for the fifth consecutive month, supported by demand from the U.S., EU and ASEAN and diversification into the Middle East and Latin America.
  • Displays: Up 4.1%. Shipments of mobile OLED panels and demand for OLED panels for IT equipment expanded.
  • Computers: A significant decrease of 54.6% due to SSD price declines and decreased demand for devices such as PCs and tablets.
  • Petroleum Products: Down by 35.3%, attributed to lower unit prices and reduced shipments.
  • Petrochemicals: Fell 12.0%, primarily due to declining exports to the U.S. and China.
  • Steel: Increased by 3.2%, though shipments to China and ASEAN declined.

Regional Export Insights.

  • Positive exports to the US, EU, and Middle East growth. Automobiles and machinery saw significant gains, particularly in the US and EU.
  • Exports to China and ASEAN faced sharp declines in semiconductors, petrochemicals, and petroleum products. However, Vietnam's exports rebounded, accounting for 51% of total ASEAN exports.

What the statistical data tells us about

South Korea's trade landscape in August presents a mixed picture.

While specific sectors face challenges, others show resilience and growth potential.

Investors and strategists should take a nuanced approach, focusing on areas that show robust demand and potential for recovery.