Korea’s shipping service exports hit record $38bn in 2022

HMM container vessel [Photo provided by HMM]

South Korea’s shipping service exports reached an all-time high of $38.3 billion in 2022, breaking the previous record in 14 years, on the back of robust global demand and diverse options offered by the country’s flagship sea carrier.

In won terms, the amount reaches 49.5 trillion won based on the average exchange rate of 1,292 won per U.S. dollar last year, the Ministry of Oceans and Fisheries said Friday. It is also 10.5 trillion won more than shipments made in 2021 based on the exchange rate of 1,144 won versus the greenback.

Shipping industry accounted for the largest 29.4 percent of the country’s entire service industry exports for a second year in 2022.

“It is difficult to give a simple comparison with commodity exports but it can be comparable to steel that was the 6th largest export item last year,” said an unnamed ministry official.

The ministry also noted that strong exports came on the recovery of the global shipping industry and the government’s efforts to support the shipping industry, such as by helping flag sea carrier HMM Co. to secure large-scale container vessels.

Sea freight rates also surged during the pandemic amid vessel shortages. Global demand for consumer goods also increased. The Shanghai Containerized Freight Index (SCFI) rose to 5,109 points in January last year from an average of 811 points in 2019.

Korea’s ocean containership capacity also rose to 1.05 million twenty-foot equivalent units (TEU) from 460,000 TEUs in 2017.

National shipping companies, in the meantime, engaged in restructuring and responded to the changing market environment by forming alliances.

Shipping service exports, however, are projected to decline this year as shipping rates have plummeted since the third quarter of last year due to the Russia-Ukraine war and China’s closing of borders.