Seoul, South Korea - South Korea's trade landscape underwent notable changes last month.
The Ministry of Trade, Industry and Energy (MOTIE) highlighted that despite a 4.4 percent drop in exports to $54.7 billion in September, the country recorded a trade surplus of $3.7 billion.
It is the highest surplus in the last two years.
Several pertinent observations emerge from these data:
- Export resilience: This September marked the second consecutive month of single-digit export declines, suggesting a stabilizing trend. Given the average daily export value of $2.6 billion, there's evidence of a steady climb back to the highs of September 2022, when exports were valued at $2.7 billion.
- Energy import dependence: A 16.5 percent decline in imports, valued at $51.0 billion, was primarily due to lower import volumes of energy sources such as crude oil, natural gas, and coal. Notably, imports of semiconductors and related equipment also declined.
Performance of Export Categories:
- Semiconductors, a major export item, registered $9.9 billion despite a 13.6 percent decline. The sector is gradually recovering, especially for high-demand products such as DDR5 and HBM.
- Automobile exports, exceptionally eco-friendly and SUV models, increased by 9.5 percent, driven by demand in North America and Europe. Exports of electric vehicles jumped a remarkable 46.5 percent.
- Machinery and steel exports were upward, driven by diversified export regions and increased demand.
Regional export dynamics:
- U.S. exports grew due to robust auto and machinery exports, even as semiconductor exports declined.
- Exports to the European Union set a record in September, supported by machinery and steel exports.
- Despite concerns about China's economic slowdown, South Korean exports to that country have consistently exceeded the $10 billion mark for two months.
While the export scenario for South Korea shows signs of stabilization, and specific sectors, such as automobiles and machinery, continue to show robust demand, the overall trade balance appears healthy.