Korea’s exports fall in Oct for first time in 2 yrs, with bigger trade deficit

Korea’s exports

South Korea’s exports fall in Oct for first time in 2 yrs, trade deficit streak extends to 7 mosnd to the seventh month in a row and swell bigger after global demand for the country’s mainstay export items chip and petrochemical products plunged amid growing recession fears from runaway inflation.

The country’s exports in October totaled at $52.48 billion, shrinking 5.7 percent compared to the same month last year, according to the Ministry of Trade, Industry and Energy data released on Tuesday. It is the first year-on-year decline in exports since October 2020.

Imports jumped 9.9 percent on year to $59.18 billion, resulting in a trade deficit of $6.7 billion, which also nearly doubled from $3.78 billion in September. It is the seventh month in a row for the country to report a trade deficit. The last time Korea recorded a run of trade deficit for seven straight months or longer was in May 1997 in the face of the Asian global financial crisis.

The sharp deterioration in Korea’s trade score is largely owed to a plunge in global demand for the country’s mainstay export items like memory chips and petrochemical products amid worsening global economic uncertainties from the prolonged Russia-Ukraine war and central banks’ monetary tightening moves across the world that have heightened economic recession fears.

Korea’s semiconductor exports retreated 17.4 percent on year, extending its losing streak for the third month in a row and petrochemical exports 25.5 percent, although car and secondary battery exports hit the best record for October. Outbound shipments of automobiles jumped 28.5 percent on year, secondary battery 16.7 percent, and petroleum products 7.6 percent.

By region, Korea’s exports to the European Union grew 10.3 percent and to the United States 6.6 percent, but shipments to China fell 15.7 percent, to Japan 13.1 percent, and to ASEAN countries 5.8 percent.

In October, imports surged nearly 10 percent on year. The sharp growth was driven mainly by high energy import costs ? crude oil, gas and coal ? that jumped 42.1 percent on year to $15.53 billion.

The country’s crude oil, gas and coal imports from January to October this year jumped by $71.6 billion, more than double the trade deficit of $35.6 billion over the same period.

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