Last month, South Korea’s ICT exports showed a year-on-year decline for the first time in 25 months. The main reason was a downturn in semiconductor prices. The memory chip price is likely to keep falling for at least six months, hitting Korea’s ICT exports.
The Ministry of Trade, Industry & Energy announced on Dec. 18 that last month’s ICT exports totaled US$18.29 billion against imports of US$9.76 billion, generating a trade surplus of US$8.53 billion. Exports decreased 1.7% from a year earlier whereas imports rose 3%.
This has to do with a memory chip price decline. South Korea’s memory chip exports posted a year-on-year growth of over 40% until September this year, yet the growth rate fell to 26.5% in October and 19.6% in November.
According to market research firm DRAMeXchange, the 4Gb DRAM spot price dropped from US$3.99 in July to US$3.13 last month. Likewise, the 64Gb NAND flash price dropped from US$4.2 to US$3.03 in one year.
Last month, South Korea’s semiconductor exports totaled US$10.79 billion, topping US$10 billion for the seventh consecutive month. The export growth rate, however, plummeted from 30.2% in July to 10.6% in November.
Display exports and mobile phone exports, which are being heavily affected by competition with China, added up to US$2.28 billion and US$1.03 billion with a year-on-year decline of 11.3% and 46.7%, respectively. Computer and peripheral exports fell 10.1% to US$810 million.
ICT exports were also affected by the slower growth of the Chinese manufacturing sector that has resulted from the ongoing trade war between the U.S. and China. Last month, South Korea’s ICT exports to China and Hong Kong, which are the largest destination, dropped 12.2% from a year ago to US$9.04 billion, showing a negative growth for the first time in 24 months.
In November, memory chip imports jumped 80.7% to US$2.12 billion and display imports rose 1.3% to US$470 million. Computer imports increased 1.6% to US$510 million.