Martial Arts Industry "Exports This Year Expected to Surpass $600 Billion for Second Highest Ever"

[Asia Economy Reporter Suyeon Woo] This year, exports are expected to surpass $600 billion for the second time in history, following $604.9 billion in 2018. In particular, semiconductors are anticipated to be the only single item with export value exceeding $100 billion.

According to the "2021 First Half Export-Import Evaluation and Second Half Outlook" released on the 29th by the Korea International Trade Association's International Trade and Commerce Research Institute, exports this year are projected to reach $601.7 billion, a 17.4% increase from last year; imports are expected to rise 26% to $591.2 billion; and the trade balance is forecasted to achieve a surplus of $10.6 billion.

The total trade volume, combining exports and imports, was $980.1 billion in 2020, falling short of $1 trillion, but this year it is expected to significantly exceed $1 trillion, reaching $1.1929 trillion.

2021 Export and Import Outlook (Unit: 100 million USD, Year-on-Year %)
(Source: Korea International Trade Association, Institute for International Trade and Commerce)

The report anticipated that with accelerated vaccine distribution and normalization of economic activities worldwide in the second half of this year, exports of key items will continue their strong performance. Especially, semiconductor exports are expected to surpass $100 billion this year, supported by increased demand from front industries such as smartphones and server memory, as well as rising export unit prices. SSD exports are also expected to increase by more than 10% in the second half, driven mainly by demand from global IT companies' data center servers.

Thanks to rising international oil prices, exports of oil-sensitive items such as petroleum products and petrochemicals, which underperformed last year, are expected to quickly return to normal. Petroleum product exports, centered on transportation fuels like aviation fuel and heavy oil, are projected to increase by more than 67% in the second half compared to the same period last year. Petrochemical exports are also expected to grow by over 47% in the second half, as prolonged COVID-19 has expanded consumption of synthetic resin materials used in disposable products.

In the case of automobiles and auto parts, although there are some difficulties in producing excess quantities due to shortages of vehicle semiconductors, automobile demand is rapidly recovering. The average monthly automobile production until May this year reached 298,000 units, nearly recovering to pre-COVID-19 levels (330,000 units monthly average in 2019). Exports of automobiles and auto parts are expected to increase by 6% and 11%, respectively, in the second half compared to the same period last year.

However, the report pointed out that if US-China relations rapidly deteriorate or disputes related to the European Union's (EU) introduction of digital taxes intensify, these could become risk factors for exports. Additionally, the sharply rising maritime freight rates are expected to remain uncertain in the second half due to a combination of factors such as limited shipping capacity and price collusion among new container manufacturers in China.

Hong Jisang, a research fellow at the Korea International Trade Association's International Trade and Commerce Research Institute, stated, "Exports in the second half are expected to continue the solid growth trend seen in the first half." He emphasized, "For our exports to maintain a favorable trend in the mid to long term, it is essential to diversify key export items into next-generation growth industries and strengthen the export competitiveness of existing core industries through digital innovation."

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