South Korea’s chip stockpiles shrink at fastest pace since 2009

SOUTH Korea’s semiconductor stockpiles dwindled at the fastest clip since 2009 last month in a sign of sustained demand for high-performance memory chips used in artificial intelligence development.

Inventories dropped 42.6 per cent from a year earlier, a quicker pace than the 34.3 per cent decline reported in July, according to data released by Statistics Korea on Monday (Sep 30). Production and shipments grew 10.3 per cent and 16.1 per cent, respectively, the data showed, in additional indications that the boom cycle endured through most of the third quarter.

The latest data may support the view the chip rally that has boosted South Korea’s economic growth this year still has room to run. Memory chips are the biggest driver of the country’s trade-reliant economy, with Samsung Electronics and SK Hynix among its top performers.

South Korea is set to report its September exports that include semiconductor shipments on Tuesday. The growth in chip exports has been moderating since May, spurring questions over the extent of the boom.

Meanwhile, South Korea’s total industrial output rose more than economists expected in August, increasing 3.8 per cent from a year earlier, compared with a forecast of 1.9 per cent. BLOOMBERG