South Korea’s exports posted their biggest drop in almost six years in May, though its trade surplus expanded as imports shrank at a faster pace, the government said Monday.
In May, the country’s overall outbound shipments came to $42.39 billion, down 10.9 percent from the same month last year.
It was the largest on-year decline since a 20.9 percent plunge in August 2009.
May marked the fifth consecutive month of an on-year drop in exports. Imports also plunged 15.3 percent on-year to $36.07 billion in May.
The country’s trade surplus came to $6.32 billion in May, compared with a surplus of $4.97 billion a year earlier. May also marked the 40th consecutive month of trade surplus.
The large drop in exports was partly attributed to a cut in global oil prices, which, in turn, pulled down the price of petroleum products, major export items of South Korea.
“Exports dropped by the largest margin since the beginning of the year in May as negative factors, such as low oil prices and a global economic downturn, continued to persist while the number of working days was also cut by one day from a year earlier,” the Ministry of Trade, Industry and Energy said in a press release.
In May, shipments of petroleum products, such as gasoline and diesel, tumbled 40 percent on-year to $2.8 billion while exports of petrochemical products also plunged 22.8 percent to $3 billion.
The ministry said the large drop is attributable to a 37.5 percent cut in the average price of petroleum products from a year earlier while that of petrochemical products also plunged 18.8 percent.
Shipments of petroleum and petrochemical products, in terms of volume, only dropped 3.9 percent and 5 percent on-year, respectively, it added.
Outbound shipments of mobile communication devices, on the other hand, spiked 26.6 percent on-year to $3.09 billion while those of semiconductors, the country’s single largest export item, grew 4.8 percent to $5.14 billion last month.
By country, shipments to China, the world’s largest market for South Korean products, slipped 3.3 percent on-year while shipments to the United States and Japan also dropped 7.1 percent and 13.2 percent, respectively.
The cut in imports was also attributed to the drop in global oil prices.
In May, the country’s imports of oil tumbled 25.8 percent on-year, in terms of value, despite a 29.7 percent spike in terms of volume, as the average price of crude oil plunged 42.9 percent to $61.70 per barrel from $108 in May 2014, according to the ministry.
Imports of raw materials, including oil and other energy, plunged 22.1 percent on-year in May while imports of capital and consumer goods surged 11.2 percent and 10 percent, respectively.
The ministry said it expected the country’s exports to improve this month, partly due to a rise in the number of working days from the same month last year.
“I believe exports will begin to improve in June, possibly posting an on-year growth as the number of working days will rise by over two days from a year earlier while auto exports are also expected to show improvements,” Kwon Pyung-oh, deputy minister for trade and investment, said at a press briefing (Yonhap)
