📦 Korea’s Early-July Exports Hit a Record $29.8B — but the Tariff Clock Reads D-5

Korea’s exports in early July set a record for the period. According to preliminary figures the Korea Customs Service released on the 13th, exports for July 1-10 came to $29.839 billion, up 53.9% from a year earlier. Celebrating that number outright is difficult, though. Five days from now, on July 24, the Section 122 temporary tariff the US currently imposes expires, and Section 301 tariffs are set to take its place. 📦

TL;DR

July 1-10 exports of $29.839 billion (+53.9%); semiconductors accounted for $11.207 billion (+193.0%), or 37.6% of the total
Trade balance posted a $6.359 billion surplus, with shipments to China up 88.7% and to the US up 43.2% — every major market grew
The US Section 122 temporary tariff expires July 24 and shifts to Section 301, with Korea currently placed in the 12.5% tariff group

How strong were early-July exports?

A single item, semiconductors, generated most of the increase.

According to the Customs Service’s preliminary trade clearance data, exports for July 1-10 totaled $29.839 billion. Working days matched last year’s 8.5, so the average daily export growth rate also came in at 53.9%. This was not a working-day illusion — volume and value genuinely rose. The previous record was $28.6 billion for June 1-10 of this year, surpassed again within a single month.

Semiconductors led the way. Semiconductor exports over the period hit $11.207 billion, a 193.0% surge from a year earlier and also a record for the July 1-10 window. Semiconductors made up 37.6% of total exports, a jump of 17.8 percentage points from a year ago. Put differently, close to $38 of every $100 exported came from semiconductors. 🔷

Other categories held up reasonably well.

Computer peripherals +208.1% — tied to AI server and data center demand
Wireless communication devices +92.4%, ships +75.1%
Petroleum products $1.751 billion (+22.7%), home appliances +17.8%, precision instruments +13.1%, steel products +12.9%
Passenger vehicles $1.899 billion (+5.7%)
Auto parts, however, fell 11.7% to $617 million

Where did the shipments go?

Major markets rose across the board. China and the US stood out in particular.

Exports to China reached $7.057 billion (+88.7%) and exports to the US $4.915 billion (+43.2%). Beyond those, Hong Kong (+196.8%), Vietnam (+92.8%), Singapore (+84.1%), Taiwan (+49.7%), the European Union (+28.9%) and Japan (+22.9%) all posted gains. Growth rates ran unusually high in Hong Kong, Vietnam and Taiwan — regions that function heavily as semiconductor transshipment and back-end processing hubs. That is a signal this export strength is flowing along the semiconductor supply chain. 🌏

Imports rose 17.4% to $23.48 billion. Semiconductor imports (+49.6%) and semiconductor manufacturing equipment imports (+49.5%) stand out, which suggests capital investment is continuing. Energy imports including crude oil (+19.0%) and gas (+24.8%) also rose 23.4%, appearing to reflect recent oil price gains.

With exports outpacing imports, the trade balance for July 1-10 posted a $6.359 billion surplus.

So why does July 24 matter?

Because that is the day the US temporary global tariff exhausts its legal time limit and disappears.

Here is the sequence. After the US Supreme Court ruled in February that the Trump administration’s reciprocal tariffs (based on IEEPA) were unlawful, the administration fell back on Section 122 of the Trade Act, imposing a 10% temporary tariff on imports worldwide. But Section 122 tariffs can be maintained for a maximum of 150 days. Those 150 days run out precisely on July 24.

The instrument stepping in to fill the gap is Section 301 of the Trade Act. The Office of the US Trade Representative (USTR) announced plans to impose an additional 10% or 12.5% tariff on 60 economies it judged to have inadequate measures barring imports of goods produced with forced labor. Korea was placed in the 12.5% group. A separate Section 301 investigation citing manufacturing overcapacity is also underway, covering 16 economies including Korea. Korea’s core export sectors — semiconductors, batteries, automobiles, shipbuilding — fall broadly within scope. ⚠️

This part warrants caution, however. The count of targeted economies varies across sources between 45, 54 and 60, and neither the final tariff rate nor the application date for the overcapacity investigation has been formally announced. What is confirmed is roughly this: Korea has been placed in the 12.5% category, and USTR is working through procedures aiming for application in late July.

How is the government responding?

The goal is clear — keeping the combined rate from the two Section 301 tariffs from exceeding 15%.

In last year’s tariff negotiations with the US, Korea agreed to lower the originally signaled 25% reciprocal tariff to 15% in exchange for pledging a $350 billion (roughly 538 trillion won) US investment plan. The government’s position is that this agreement remains in force.

At a USTR public hearing held on July 9 local time at the US International Trade Commission (USITC) in Washington DC, Commercial Counselor Lee Seung-heon of the Korean Embassy’s commercial affairs office attended and formally conveyed the position that the measure is “unjust and unnecessary.” The written comments the government submitted earlier rested on three main arguments.

Insufficient factual basis — the USTR report failed to present concrete cases showing that Korean imports linked to forced labor affected US commerce
Statistical rebuttal — data showing that for certain items, there were no imports at all from the country in question during 2021-2025
Policy efforts not reflected — institutional responses such as the K-ESG guidelines and the promotion of OECD Guidelines for Multinational Enterprises were not factored into the assessment

The Korea International Trade Association reportedly also called for reconsideration on grounds that the 12.5% rate lacks basis, asking that it be adjusted to around 10% if imposition proves unavoidable.

Overall assessment 📌

Korea’s economy has entered a stretch where the indicators and the risks point in opposite directions.

Judged on export data alone, conditions look excellent: a record for the July 1-10 period, a 193% semiconductor surge, a $6.3 billion trade surplus, and gains across every major market. Two caveats attach to those numbers, though.

The first is concentration. Semiconductors alone supplied 37.6% of total exports, and much of that 193% growth rate likely stems from rising memory prices rather than volume. Should prices enter a correction phase, the growth rate could fall away quickly. Sector-level divergence exists too — auto parts declined 11.7%.

The second is tariffs. The July 1-10 results emerged under the Section 122 10% tariff regime. Depending on how rates change after the 24th, the trajectory from August onward could shift. With US-bound exports up 43.2%, sensitivity to rate changes has arguably increased rather than diminished.

Three points to watch ahead: ① the content of USTR’s final tariff rate announcement around July 24, ② whether the 15% ceiling holds, and ③ whether this growth pace carries into the July 1-20 preliminary trade figures due on July 21. Distortions such as front-loaded shipments or customs clearance delays can appear around tariff confirmation, so it is worth reserving judgment until the finalized July results arrive in early August.

※ This post is for informational purposes only and is not investment advice.

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