[News] South Korea’s Chip Exports to China Plunge in February Amid Stricter U.S. Restrictions

According to a report from Bloomberg, South Korea’s semiconductor exports to China experienced a significant drop in February, deepening concerns over a global demand slowdown, which was already under pressure from U.S. tariffs.

As noted by the report, South Korea’s semiconductor exports to China dropped by 31.8% year-over-year, according to South Korea’s Trade Ministry. This decline surpasses the 22.5% contraction recorded in January and follows a 2024 surge that had contributed to South Korea’s economic growth.

The report suggests that the decline at the beginning of 2025 aligns with the tightening of U.S. restrictions. In December 2024, the U.S. Department of Commerce imposed new restrictions on the sale of HBM chips to China. SK hynix and Samsung Electronics are two of the world’s biggest memory-chip makers and they operate semiconductor plants in China, as the report notes.

South Korea’s overall semiconductor exports declined by 3% year-over-year in February, based on government data, as the report indicates. The ministry stated that slowing export growth was due to declining conventional memory chip prices and a technological shift in semiconductor production, according to the report.

Potential U.S. Chip Policies Could Pressure South Korean Tech Firms

According to the Korea JoongAng Daily, the U.S. Trade Representative (USTR) is considering imposing additional tariffs on Chinese legacy semiconductors, which could pressure South Korean companies like Samsung Electronics and SK hynix if they are required to comply. The report notes that South Korean firms with semiconductor manufacturing operations in China could be directly affected by these tariffs, adding uncertainty to their business strategies.

Additionally, the U.S. Department of Commerce has already tightened export controls on advanced semiconductor manufacturing equipment to China, specifically restricting DRAM production below 14 nanometers and NAND flash memory exceeding 128 layers. As highlighted by the report, while Samsung Electronics and SK hynix previously secured verified end-user status from the U.S. government—permitting limited facility upgrades in their Chinese facilities in Xi’an and Wuxi—policy changes now threaten these approvals, potentially disrupting ongoing operations and future expansion.

Read more

• [News] Samsung & SK Hynix Post Strong 2024 Sales in China, Driven by China’s “Old-for-New” Policy
• [News] NAND Prices on the Rise: Micron and SanDisk Lead in April, with Samsung, SK hynix Likely to Follow

(Photo credit: SK hynix)