Domestic Supply in Manufacturing Down 0.4% in Q1...Automobiles Increase While Chemical Products and Primary Metals Decrease

In the first quarter of this year, domestic supply in South Korea's manufacturing sector showed a decline for the second consecutive quarter, following a 0.2% decrease in the fourth quarter of last year.

According to the '2023 Q1 Manufacturing Domestic Supply Trends' released by Statistics Korea on the 9th, the manufacturing domestic supply index in the first quarter of this year decreased by 0.4% compared to the same period last year. Domestic products such as chemical products and electronics & telecommunications decreased by 1.9%, while imports such as automobiles and chemical products increased by 3.7%.

[Image source=Yonhap News]

The manufacturing domestic supply index quantifies the real supply value of manufacturing products produced domestically and shipped within the country, or produced abroad and distributed domestically, reflecting trends in the domestic market.

Manufacturing domestic supply increased for two consecutive years, rising 6.1% in 2021 and 1.4% last year, but the growth rate slowed. This figure reflects the revision of the base year to 2020 from 2015 starting in the first quarter of this year, incorporating changes such as item categories, industries, and weighting.

By industry, automobiles increased by 21.4%, marking the largest growth in the past five years since 2018. Both domestic (20.0%) and imported (30.0%) products increased. In contrast, chemical products decreased by 6.7%, with imports rising by 12.4% but domestic products falling by 14.8%. Primary metals also declined by 7.2%, with both domestic (-6.1%) and imported (-10.6%) products decreasing. Electronics & telecommunications decreased by 5.2%, as imports rose by 1.3% but domestic products fell by 12.3%. A Statistics Korea official stated, "The damage to the Pohang steelworks caused by Typhoon Hinnamnor last year significantly reduced the domestic supply of stainless steel sheets."

During the same period, domestic supply of final goods decreased by 1.2% compared to the same period last year, while intermediate goods saw a 0.4% increase due to a decrease in domestic products (-1.4%) but an increase in imports (5.5%). Among final goods, consumer goods domestic supply decreased by 0.4%, with imports rising by 4.4% but domestic products falling by 2.5%. Capital goods domestic supply also decreased by 2.5%, with both domestic (-2.9%) and imported (-1.7%) products declining.

Meanwhile, the share of imports in total manufacturing products last year was 28.6%, up 0.5 percentage points from the same period the previous year. By industry, the import share of tobacco (31.5%) rose by 8.8 percentage points compared to the previous year. Import shares of chemical products (6.8 percentage points) and electrical equipment (4.4 percentage points) also increased. Conversely, non-metallic minerals fell by 3.9 percentage points.

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