Rebounding Exports
According to the Korea Customs Service, South Korea’s exports totaled US$11.6 billion for the first 10 days of this month, up 37.7% from a year ago. Previously, the exports fell 5.9% year on year in September last year and 3.2% in October but rose 2.5% and 6.4% in the following months to increase for two months in a row for the first time in 26 months. If the pace continues, the exports are likely to rise for the third consecutive month.
The growth was led by petroleum-based products (up 121.4%), semiconductor (up 40.3%) and steel products (up 22.9%). Semiconductor exports, in particular, have continued to show a positive growth since October last year based on an increase in memory chip prices, showing the highest rate of increase in three years. According to industry sources, the global semiconductor industry is in a super cycle now. The spot price of 4GB DRAM chips jumped from US$1.82 to US$2.71 between January and December 2016.
Petroleum-based products are enjoying an increase in unit price as well, led by rising international oil prices. The Dubai crude price soared by close to 50% from a year earlier and this led to a 15% increase in export unit price. On the contrary, wireless communication equipment and ship exports declined by 25.8% and 0.7%, respectively. During the 10 days, South Korea increased its exports to Vietnam by 93.9%, China by 45.3%, EU by 41.2%, Japan by 33.5% and U.S. by 16.4%. Its exports to Latin America fell 13.6% though.