Korean exports accelerate again, with the AI semiconductor price cycle as the core driver

Overview

This report focuses on Korea's May export data. Exports rose 53.2% YoY, driven by semiconductors, computers/SSDs, and oil product prices; imports rose 20.8% YoY, and the trade surplus widened to USD26.95bn. The report argues that the AI capex cycle remains the core driver of Korea's external demand strength, but export strength is mainly concentrated in semiconductors, memory, and the AI infrastructure chain, while autos, machinery, steel, and other sectors remain weak.

Core views

Nomura's core judgment is that strong chip prices will continue to support Korean exports and the Bank of Korea's growth optimism, but the real economic recovery is uneven. The sharp increase in semiconductor export revenue is driven more by price effects than by a broad-based expansion in export volumes; the Bank of Korea's export volume indicators may overstate the actual contribution of exports to GDP because price indices lag. Therefore, Nomura maintains its 2026 Korea GDP growth forecast at 2.4% and expects the Bank of Korea to raise rates by 25bp each in July 2026, October 2026, and January 2027, taking the policy rate to 3.25%.

Analysis framework

The report uses a macro export decomposition framework to analyze Korea's export cycle from the perspectives of product categories, export destinations, nominal value versus real export volume, price indices, and the policy reaction function. It focuses on comparing the sources of growth in semiconductors, computers/SSDs, autos, oil products, petrochemicals, non-ferrous metals, and secondary batteries, and discusses the divergence between customs-based export volumes and the Bank of Korea's export volume index.

Methodology notes

• Macro export cycle analysisProduct and destination breakdown

  Decomposes export growth into product categories such as semiconductors, SSDs, autos, oil products, and petrochemicals, and observes destination contributions from China, the United States, ASEAN, the European Union, and others.

  This method is used to identify whether export growth comes from broad-based demand improvement or is concentrated in the AI-related semiconductor supply chain.

• Price and volume decompositionComparison of nominal exports and real export volumes

  Compares customs-based export volumes with the Bank of Korea's export volume index, while focusing on the impact of price deflators on real export volumes.

  The report argues that the Bank of Korea's export price index may be slow to reflect price increases in HBM and AI-related semiconductors, leading to an overstatement of real export volumes and GDP contribution.

• Macro growth structureK-shaped growth framework

  Some high-boom industries expand rapidly while others remain under pressure, creating a divergent recovery.

  Korea's export engine is very hot, but the high-powered core is mainly AI-related semiconductors, memory, and infrastructure, while autos, machinery, steel, and some traditional industries remain weak.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Korean semiconductor and memory export chain

  Directly benefits from AI capex and rising memory prices

  Strengths

  Semiconductor exports hit a monthly record high, with DRAM, NAND, and DDR5 prices rising sharply, giving export revenue high elasticity.

  Weaknesses

  Growth is driven more by price effects; if the price cycle turns down, nominal exports could cool quickly.

  Comparison

  Compared with traditional export sectors such as autos, machinery, and steel, semiconductors are the high-powered core of this round of Korean exports.

  Risks

  If HBM and AI-related semiconductor prices decline, exports, corporate profits, and policy optimism could weaken.

• Enterprise SSD and AI server supply chain

  Benefits from the spread of demand from AI data center buildout

  Strengths

  Computer exports rose 290.7% YoY and SSD exports rose 337.7% YoY, showing that AI demand has expanded from chips to storage devices.

  Weaknesses

  Demand is concentrated in AI infrastructure; if capex slows, order sustainability will be tested.

  Comparison

  Stronger than traditional IT exports and, like semiconductors themselves, benefits from the AI cycle, though at a smaller scale.

  Risks

  Changes in cloud provider capex pacing, inventory cycles, and price corrections.

• Korean automobile export chain

  Export performance remains under pressure, diverging from semiconductor strength

  Strengths

  Hybrid and EV exports are still maintaining positive growth, so the internal product mix is not deteriorating across the board.

  Weaknesses

  Overall automobile exports fell 5.9%, with ICE vehicles down 14.4%, affected by parts supply, logistics, U.S. tariffs, and overseas localization of production.

  Comparison

  Compared with semiconductors and SSDs, auto exports are clearly lagging and represent the weak side of the K-shaped recovery.

  Risks

  Tariffs, geopolitical logistics disruptions, supply chain interruptions, and continued overseas production localization could keep pressuring exports.

• Petroleum products and petrochemicals

  Nominal exports are supported by prices, but volumes are weak

  Strengths

  Petroleum product exports rose 46.6% YoY, and petrochemical exports rose 11.1% YoY.

  Weaknesses

  Petroleum product export volumes fell 23.8% and petrochemical export volumes fell 25.5%, indicating weak real demand.

  Comparison

  Unlike semiconductors, the nominal strength of oil products and petrochemicals depends more on prices than on volume expansion.

  Risks

  A decline in oil prices would weaken export values, while weak real demand could become more exposed.

• Korean interest rates and Bank of Korea policy expectations

  Strong exports and growth optimism support a more hawkish policy path

  Strengths

  The Bank of Korea has already raised its 2026 GDP growth forecast, and Nomura expects three 25bp hikes to 3.25%.

  Weaknesses

  If export volumes are overstated and domestic demand recovers slowly, the growth foundation for tighter policy may not be broad enough.

  Comparison

  Nominal export data support a hawkish stance, but the decline in customs-based export volumes suggests weaker underlying growth momentum.

  Risks

  Trade-offs among inflation, financial stability, and growth quality may make the policy path more uncertain.

Key data

• May export growth53.2% y-o-yAbove the market consensus of 49.3%, but below Nomura's forecast of 61.5%.
• May import growth20.8% y-o-yImport value was USD60.80bn.
• May trade surplusUSD26.95bnExpanded from USD23.8bn in April.
• Cumulative surplus in January-MayUSD101.91bnAlready exceeded the full-year 2017 record of USD95.2bn.
• Average daily exports in MayUSD4.28bnA record high, up 60.7% YoY.
• Semiconductor exportsUSD37.16bn，169.4% y-o-yA new monthly record high, accounting for more than 42% of total exports.
• Memory semiconductor exportsUSD32.1bn，255% y-o-yDRAM exports rose 369.8% YoY, and NAND exports rose 206.8% YoY.
• DDR5 16Gb contract priceUSD37.50，682.1% y-o-yRose from USD4.80 in May 2025 to USD37.50 in May 2026.
• NAND 128Gb priceUSD26.51，806.9% y-o-yRose from USD2.92 in May 2025 to USD26.51 in May 2026.
• Computer exportsUSD4.18bn，290.7% y-o-yMainly driven by demand for enterprise SSDs related to AI servers.
• SSD exportsAbout USD3.97bn，337.7% y-o-yReflecting the spread of AI data center demand into storage devices.
• Automobile exports-5.9% y-o-yICE vehicle exports fell 14.4%, hybrids grew 6.8%, and EVs grew 16.0%.
• Petroleum product exports46.6% y-o-yExport volumes fell 23.8%, so growth mainly came from prices.
• Petrochemical exports11.1% y-o-yExport volumes fell 25.5%, likewise showing a price-driven pattern.
• Nomura 2026 GDP forecast2.4%Unchanged, on the view that the domestic demand recovery will be slow.
• Bank of Korea policy rate pathThree 25bp hikes, terminal rate 3.25%The first hike is expected in July 2026, followed by October 2026 and January 2027.

Impact & implications

The investment implication of the report is that Korea's macro outlook and export chain remain highly dependent on the AI semiconductor price cycle, with beneficiary assets more concentrated in memory, SSDs, AI servers, and related raw material chains; but traditional autos, machinery, steel, and price-driven oil products and petrochemicals have not shown comparable strength. For macro policy, strong exports and the Bank of Korea's growth optimism may increase the probability of rate hikes, but if real export volumes and domestic demand transmission are weaker than nominal data suggest, the quality of growth still requires cautious assessment.

Risks

• A decline in AI-related semiconductor and memory prices could weaken Korea's export revenue and corporate profits.
• The Bank of Korea's export price index may lag in reflecting rising chip prices, leading to an overstatement of real export volumes and GDP contribution.
• The export recovery is overly concentrated in semiconductors and AI hardware, while domestic demand, autos, machinery, steel, and other sectors remain insufficiently repaired.
• U.S. tariffs, overseas localization of production, parts supply disruptions, and Middle East conflict-related logistics issues continue to weigh on auto exports.
• Oil product and petrochemical exports are mainly price-driven; if oil prices fall while volumes remain weak, nominal growth could reverse.
• If the Bank of Korea raises rates due to growth optimism and financial stability concerns, it could further drag on the domestic demand recovery.

What to watch

• Whether memory prices such as HBM, DDR5, and NAND can remain elevated.
• Whether Korean semiconductor, computer, and SSD exports can sustain double-digit growth.
• Whether the divergence between customs-based export volumes and the Bank of Korea's export volume index widens.
• Whether the Bank of Korea follows through on the expected hiking path at the July, October, and January 2027 meetings.
• Changes in the mix of ICE vehicles, hybrids, and EVs within auto exports, as well as the impact of U.S. tariffs and localized production.
• Changes in import demand from China, the United States, ASEAN, and the European Union for Korean semiconductors and AI hardware.
• Whether price and volume contributions in oil product and petrochemical exports rebalance again.