South Korea exports likely rose for fifth month in Feb: Reuters poll

By Thomson Reuters Feb 27, 2024 | 11:07 PM

By Jihoon Lee

SEOUL (Reuters) – South Korea’s exports likely rose in February for a fifth straight month, led by chip shipments, a Reuters poll showed on Wednesday, in which analysts said much slower growth this month would be largely due to unfavourable calendar effects.

Exports out of Asia’s fourth-largest economy are expected to have risen 1.9% in February from a year earlier, according to the median estimate of 22 economists in the survey conducted Feb. 22-27.

That follows an 18.0% jump in January, which was the fastest since May 2022. Data out of South Korea is often distorted in January and February, due to timing differences in Lunar New Year holidays.

There were less working days in February this year than last year, because the Lunar New Year holiday period was pushed back to February from January.

“The improving trend of exports, led by semiconductor exports, is judged to be continuing,” said Park Sang-hyun, an economist at HI Investment Securities.

“There are signs of recovery in shipments to the greater China region, which is another positive signal,” Park said.

South Korea’s exports started to rise slowly from October 2023 after a year-long downturn, mostly on improving demand for semiconductors, leading uneven economic growth.

In the first 20 days of this month, while exports in total fell 7.8%, chip sales jumped 39.1%. Semiconductor exports are likely to extend their gains to a fourth straight month this month.

“Exports to China and semiconductor exports likely continued to expand on AI-related semiconductor demand,” said Park Chong Hoon, economist, Standard Chartered.

However, other than semiconductors, shipments of most other products were seen sluggish, analysts said.

Meanwhile, imports likely fell 10.4% in February from a year earlier, after falling 7.9% in January, according to the survey. That would mark the 12th consecutive month of imports falling.

In the survey, the median forecast for the monthly trade balance pointed at a surplus of $1.90 billion, compared with $0.33 billion in January.

South Korea – the first major economy to report trade data each month – is scheduled to report the figures for February on Friday, March 1, at 9 a.m. (0000 GMT).

(Reporting by Jihoon Lee; Polling by Veronica Khongwir and Devayani Sathyan in Bengaluru; Editing by Aurora Ellis)