Trade Balance Turns Surplus in June for the First Time in 16 Months... Lowest Export Decline This Year (Comprehensive)

June Export-Import Trends
Trade Surplus of 1.1 Billion USD
Exports at 54.24 Billion USD... 6% Decrease Compared to Same Period Last Year

Last month, the trade balance turned to a surplus for the first time in 16 months. The year-on-year export decline rate also dropped to its lowest level this year. Automobiles continued their growth trend for 12 consecutive months. Although semiconductors still faced a decline, their export value reached the highest level this year.

On the 1st, the Ministry of Trade, Industry and Energy announced the 'June 2023 Export-Import Trends' report containing these details.

Last month, exports decreased by 6.0% year-on-year to $54.24 billion, imports fell by 11.7% to $53.11 billion, and the trade balance recorded a surplus of $1.13 billion.

Accordingly, exports in the first half of the year decreased by 12.3% compared to the same period last year, totaling $307.3 billion, with a monthly average of $51.2 billion. This ranks as the second highest first half on record.

June exports declined due to delayed recovery in the semiconductor industry and a reverse base effect from last June’s record-high exports for the month ($57.7 billion). However, the export decline rate was the lowest this year: ▲January -16.4%, ▲February -7.7%, ▲March -13.8%, ▲April -14.4%, and ▲May -15.2%.

By item, exports increased for seven categories including automobiles (+58.3%), general machinery (+8.1%), ships (+98.6%), and secondary batteries (+16.3%). Automobile exports have shown strong performance exceeding $6 billion since March, achieving the highest half-year export record ever. Semiconductor (-28.0%), petroleum products (-40.9%), and petrochemicals (-22.0%) exports declined in June due to price drops compared to the previous year.

Semiconductors, Korea’s largest export item, recorded the highest export value this year at $8.9 billion. A Ministry official stated, "Semiconductor exports have shown the best performance this year," adding, "With visible effects of memory production cuts and increased demand for high-performance DDR, the industry is expected to gradually improve from the second half."

By region, exports to the European Union (EU), the Middle East, and Latin America turned positive in June, supported by increased automobile and general machinery exports. Exports to the United States in June ($9.6 billion) remained flat due to a reverse base effect from last June’s strong exports ($9.8 billion, the highest ever for June). Exports to China and ASEAN declined in June due to falling semiconductor prices and reduced global imports by China and Vietnam (the largest trading partner within ASEAN). However, exports to China remained above $10 billion for the second consecutive month, with the export decline rate improving slightly from -21.1% in May to -19.0% in June.

June imports decreased by 11.7% due to reduced energy imports (-27.3%), including crude oil (-28.6%), gas (-0.3%), and coal (-45.5%). Imports of semiconductors and steel also continued to decline.

The trade balance recorded a surplus of $1.1 billion in June, marking the first surplus in 16 months since February last year.

A Ministry official said, "The government will continue this trade surplus trend and accelerate efforts to achieve positive export growth in the second half by expanding exports and promoting energy saving and efficiency improvements." They added, "To reach 100,000 exporting companies, we will provide customized support for small and medium-sized enterprises and mid-sized companies facing export difficulties."

(Photo) [Image source=Yonhap News]

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