(2nd LD) Exports up 5.4 pct in June; trade deficit hits record high in H1

All News 12:43 July 01, 2022

(ATTN: ADDS more info, industry chief's comments in paras 11-19, 22-23, additional photo)
By Oh Seok-min

SEOUL, July 1 (Yonhap) -- South Korea's exports rose 5.4 percent on-year in June to US$57.73 billion on solid demand for chips and petroleum products, but the country extended its trade deficit for the third consecutive month due to high global energy prices, data showed Friday.

During the first six months of this year, the country saw exports reach an all-time half-year high, but high-flying energy prices sent the trade deficit to the highest figure for any first-half period, according to the data compiled by the Ministry of Trade, Industry and Energy.

Kia Motors Corp.'s cars await shipment at a plant in the southwestern city of Gwangju on June 13, 2022, as truck drivers continue a strike nationwide, demanding the extension of a basic freight rate system guaranteeing their basic wages. (Yonhap)

Last month, outbound shipments stood at $57.73 billion, up from $54.78 billion a year earlier.

It is the highest tally for any June since the ministry began compiling related data in 1956. The previous record was set a year earlier.

June marked the 20th consecutive month that the country's exports have logged an on-year expansion. But the growth slowed down to end 15 straight months of double-digit growth.

The slowdown came as the country had fewer working days in June due to holidays for the June 1 local elections and Memorial Day on June 6. This year's number of 22 days is fewer than the 24 days for the same month last year.

Exports were also affected by domestic logistics disruptions over a truckers' strike in early June, according to officials.

Imports jumped 19.4 percent on-year to $60.2 billion in June on soaring global energy prices, leading the country to post a trade deficit of $2.47 billion, the data showed. The country has posted a trade deficit since April.

Dubai crude, South Korea's benchmark, rose to $113.27 per barrel in June on average from $71.6 a year earlier.

South Korea depends on imports for most of its energy needs, and the country's energy imports spiked around 63.7 percent on-year to $13.73 billion in June, according to the ministry.

By item, sales of semiconductors grew 10.7 percent to $12.35 billion and those of petroleum products spiked 81.7 percent to 5.48 billion in June.

Steel products also saw their sales overseas increase 5.4 percent on-year to $3.28 billion last month, and the medical and bio sectors enjoyed a 3.8 percent on-year growth to $1.38 billion.

But auto exports fell 2.7 percent on-year to $3.93 billion due mainly to the truckers' strike and chip shortage, and those of petrochemicals inched down 0.4 percent to $4.58 billion.

By nation, exports to the Association of Southeast Asian Nations (ASEAN) jumped 16.7 percent to $10.25 billion.

Shipments to the United States advanced 12.2 percent to $9.78 billion, and those to the EU added 2.4 percent to $5.33 billion.

But exports to China inched down 0.8 percent on-year to stand at $12.97 billion.

During the first six months of this year, South Korea saw exports grow 15.6 percent to an all-time half-year high of $350.3 billion on the back of strong sales in semiconductors and petroleum products.

Imports advanced 26.2 percent on-year to $360.6 billion due mainly to high global energy costs and the surge in raw material prices.

The country, accordingly, logged a trade deficit of $10.3 billion in the January-June period, which was the highest figure for any first-half period, the data showed.

"South Korea made the achievement in exports this year despite unfavorable external conditions, including the war in Ukraine and the lockdown of major Chinese cities over the COVID-19 pandemic," Industry Minister Lee Chang-yang said.

"But we are facing growing challenges amid a global economic slowdown and unstable supply chains. The government will do its best to strengthen our export competitiveness by easing regulations and extending financial and logistics support."