K-beauty, chips push Korean SME exports to Q3 record
Korean small businesses posted a record $33.4 billion in third quarter exports as cosmetics and semiconductor demand surged, with the United States overtaking China as their top market.
Beauty influencers and local shoppers turn out for the opening of the "Olive Young K-Beauty Edit" at Sephora's Times Square store in New York on Aug. 20.CJ OLIVE YOUNG
Korean small- and medium-sized enterprises (SME) exported a third quarter record of $33.4 billion as overseas demand for K-beauty products and semiconductors surged.
The July-to-September total was up 8.8 percent from a year earlier, the Ministry of SMEs and Startups said Monday in its quarterly report on SME export trends.
Cumulative exports for the first nine months rose 9.5 percent on year to $96.5 billion. The number of SMEs that exported goods rose 1.6 percent to 90,765, also the most on record.
Cosmetics led the growth. Cosmetics exports in the third quarter rose 28.6 percent on year to $2.79 billion, while cosmetics exports for the first nine months climbed 26.4 percent to $7.65 billion. Each figure was a third quarter record.
Independent brands built name recognition on online platforms such as Amazon and TikTok Shop before expanding into major North American retail chains. Their online success and expansion into physical stores helped drive export growth.
K-beauty exporters are also reaching more markets. Third quarter cosmetics exports rose 33.1 percent to North America and 58.6 percent to Europe. Shipments to Latin America, an emerging market, surged 141.3 percent.
The number of SMEs exporting cosmetics rose 6.3 percent on year to 9,469 in the first nine months. Cosmetics accounted for 75.3 percent of the $470 million that SMEs exported through online channels in the third quarter.
Semiconductor exports jumped 68.8 percent to $1.39 billion in the third quarter amid a boom in the AI market. Chipmaking equipment exports grew 38.3 percent to $1.14 billion. Both figures were third quarter records.
Petroleum product exports rose 29.3 percent to $660 million, partly due to higher global oil prices.
Hyundai Motor cars are seen at the automaker's Ulsan port on May 12.YONHAP
Automobile exports, by contrast, fell 42.4 percent to $1.51 billion over the same period. Shipments to Russia and Central Asia declined partly because of a Russian tax on imported used cars, while instability in the Middle East further hurt exports. A 66.6 percent plunge in automobile exports to the United Arab Emirates made the overall decline steeper.
The United States overtook China as the largest destination for SME exports in the third quarter. Exports to the United States rose 19.6 percent on year to $5.73 billion during the period.
Cosmetics exports to the United States grew as distribution networks for K-beauty products expanded in the country. Exports of rechargeable batteries and related materials also increased.
"Despite an unstable external environment, SME exports are making gains in major markets such as the United States and emerging markets such as Latin America," Shim Jae-yoon, director-general for global growth policy at the ministry, said. "We will strengthen support through export vouchers and programs that help large companies and SMEs expand overseas together."
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
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