Last Year’s Air Transport Exports Reach Record High of 35.7%... Maritime Transport Declines

At Incheon International Airport Cargo Terminal, the initial batch of Pfizer vaccines secured through the international vaccine supply organization 'COVAX facility' is being unloaded from a Korean Air passenger plane. / Yeongjongdo - Photo by Airport Photographers Group

[Asia Economy Reporter Kim Heung-soon] A survey revealed that the export share of air transportation last year reached an all-time high of 35.7%.

According to the '2020 Air and Maritime Export Logistics Trends and Implications' report released on the 17th by the Korea International Trade Association's International Trade and Commerce Research Institute, South Korea's total exports last year amounted to $512.5 billion, with air transportation exports accounting for 35.7% or $183 billion, and maritime transportation making up 63.5% or $325.8 billion. Compared to 2019, the share of air transportation increased by 5.4 percentage points, marking a record high, while the share of maritime transportation decreased by 5.6 percentage points.

The increase in air cargo exports is attributed to the rise in exports of lightweight yet high value-added products such as semiconductors, next-generation large-capacity storage devices like SSDs, organic light-emitting diodes (OLEDs), IT products, and pharmaceuticals. Air exports of pharmaceuticals and computers increased by 79.7% and 77.3% respectively compared to the previous year, with flat panel displays (21.6%) and semiconductors (15.8%) also seeing significant growth.

Maritime transportation exports sharply declined, especially for heavy chemical products, due to issues such as soaring freight rates, port congestion, and shortages of empty containers caused by COVID-19. In particular, maritime exports of petroleum products, steel, and automobiles?sectors where maritime transport accounts for over 98%?decreased by 40.6%, 14.7%, and 13.3% respectively. For flat panel displays, maritime export value exceeded air transportation by $6.4 billion in 2019, but the gap narrowed to $1.1 billion in 2020.

With the recovery of major economies, international trade volume and South Korea’s exports are expected to expand. However, logistics challenges such as strong freight rates due to increased cargo volume, rising vaccine transportation demand, and oil price hikes, as well as delays in resolving port logistics congestion, are expected to persist for the time being. A recent survey conducted by the International Trade and Commerce Research Institute targeting 945 domestic export companies found that companies anticipate the greatest difficulties in the second quarter of this year to be 'rising raw material prices' (21.0%), followed by 'increased logistics costs' (20.3%).

Researcher Kang Sung-eun of the Trade Association stated, "To alleviate logistics difficulties faced by export companies, it is necessary to suppress excessive freight rate increases and expand the supply of empty containers to enable timely transportation."

This content was produced with the assistance of AI translation services.