South Korea’s exports jumped 60.4% in June, chip sector leads record surplus

South Korea recorded a dramatic 60.4% year-on-year increase in exports for the first 20 days of June, according to preliminary customs data. Even after adjusting for calendar effects, exports were up by nearly 50%, sustaining the robust growth seen in May, when shipments rose by 52.6%. The data highlights how soaring demand for artificial intelligence infrastructure is fueling South Korea’s external trade performance.

Chip exports power trade boom

Customs figures showed the country’s exports climbed to $62 billion in the first 20 days of June, up from $38.6 billion in the same period last year. Imports also increased by 23.2% to $44.5 billion, resulting in a substantial $17 billion trade surplus.

At the heart of this surge is the semiconductor industry. Accelerating global investment in AI infrastructure has sent demand for memory chips soaring, benefiting key producers such as Samsung Electronics and SK Hynix. Both companies have established themselves as leaders in high-bandwidth memory chips used in AI data centers.

Quick glossary: HBM, or high-bandwidth memory, is an advanced memory type designed for the heavy processing workloads of AI. These chips work alongside graphics processors in large data centers to enable high-speed data transfer.

The latest figures show semiconductor shipments outperforming all other sectors. Chip exports soared 188.4% year-on-year, with revenues reaching $25.5 billion. Computer product exports rose an even higher 293.3%. Elevated energy prices also boosted exports of petroleum products.

Central bank monitors broader impacts

South Korean policymakers are closely analyzing how chip-driven growth is affecting the wider economy. While strong sales are bolstering GDP, tax revenues, and asset markets, the combination of a weaker won and high oil prices may prompt the central bank to adopt a more hawkish stance.

Inflation rose to 3.1% in May, the highest level in two years, reinforcing expectations that monetary policy may tighten. Authorities are also warning that generous bonuses in the tech sector could intensify wage pressures.

The breakdown by destination further demonstrates broad global demand. Exports to China surged 86.9% to $13 billion, while shipments to the United States climbed 53.9% to $11.4 billion. Sales to Vietnam increased by 75.5%, and exports to the European Union grew by 13.6%.

JPMorgan urges caution on chip rally

JPMorgan, meanwhile, flagged rising concentration in semiconductor trades as a source of potential market volatility. Analyst Nikolaos Panigirtzoglou noted that the combination of high investor positioning and increased volatility could set the stage for more frequent market disruptions.

The bank highlighted index concentration as a core risk. As semiconductor stocks account for a greater share of major indexes, funds adhering to strict risk limits may be forced into systematic selling if thresholds are breached. JPMorgan further observed that the price-to-revenue ratio of chip stocks has climbed above 6, signaling notable valuation levels.

Portfolio rebalancing at the end of June could also pose short-term technical risks. The bank estimates that as much as $165 billion in stock could be sold as funds shift toward bonds. In the same report, JPMorgan assessed that many bitcoin mining firms are now operating on thin profit margins, making them increasingly sensitive to price stability.

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