(Bloomberg) — South Korea’s chip export prices rose at their fastest pace on record in May, highlighting the strength of the AI rise that is driving the country’s economic momentum.
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South Korea's notoriously cyclical memory industry, led by Samsung Electronics and SK Hynix, is recovering rapidly from the downturn, with the country's semiconductor export price index rising 42.1% year-on-year in dollar terms, according to data released by the Bank of Korea on Friday. Most of the country's semiconductor exports are memory, and part of the surge is due to high-bandwidth memory designed to pair with artificial intelligence accelerators, such as those made by Nvidia Corp.
May's cost rise was the fastest ever in data dating back to the 1970s and followed a 41.4% jump in April.HBM has become a bottleneck in AI chip production, with SK Hynix's production capacity nearly sold out through 2025 and Samsung having challenges getting its products approved by Nvidia.
Memory chips are a mainstay of South Korea's tech industry along with smartphones and displays. Samsung and SK Hynix are also South Korea's two most valuable companies. Memory exports have been rising since late last year amid growing global demand for chips used in AI development, adding to the momentum that powered South Korea's economy's better-than-expected growth in the first quarter.
Semiconductor exports rose 36.6% in the first 10 days of May, according to the Korea Customs Service, suggesting double-digit growth is likely to continue for the entire month. Shipments could rise further if Samsung can secure orders from rival chipmakers such as Nvidia and Advanced Micro Devices.
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