S. Korea's IT exports contract in January on falling prices

South Korea's exports of information technology (IT) products contracted last month due to falling prices of key items such as memory chips and display panels, a government report showed Tuesday.Exports of locally-manufactured IT products amounted to 11.18 billion U.S. dollars in January, down 12.8 percent from a year earlier, according to the Ministry of Knowledge Economy. The exports were smaller than 12.6 billion dollars tallied in the previous month.The January reduction was mainly attributed to declining unit prices of memory chips and display panels. Prices for DRAM and NAND flash chips sank 53.8 percent and 39.0 percent each in January from the previous year, with that for LCD panels dropping 21.9 percent over the same period.Imports of IT products shrank 10.4 percent on-year to 6.25 billion dollars in January, sending the trade surplus in the IT sector to 4.93 billion dollars last month, down from 6.13 billion dollars a year before.The country's trade balance turned into the red last month amid lingering external uncertainties such as Europe's fiscal crisis, but the balance in the IT industry continued its surplus trend, contributing to limit the trade deficit's further widening, the ministry said.By item, exports of locally-made handsets continued its downward trend due to local firms' expansion in overseas production, but the country's market share was expected to rank first for three straight quarters, according to the ministry.Exports of handsets contracted 39.3 percent on-year to 1.44 billion dollars in January, but South Korean handset makers were forecast to post the highest global market share of over 26 percent in the fourth quarter of last year.Exports of memory chips declined 8 percent on-year to 3.77 billion dollars last month due to delayed recovery in product prices, but its global market share kept an upward trend with the share for DRAM chips rising to 66.7 percent in the third quarter from 65.2 percent three months earlier. The ministry noted that shipments of system semiconductors such as application processors and display drivers posted an on-year growth for 29 straight months in January.Outbound shipments of display panels dropped 11.2 percent on- year to 2.27 billion dollars in January due to falling prices of flat screens and weak demand for LCD TVs in advanced economies. The country's TV exports sank 25.9 percent on-year to 470 million dollars last month.Computer exports grew 4.7 percent on-year to 600 million dollars in January due to strong demand for locally-made tablet PCs and super-slim laptops, but exports of computer-related products such as printers and monitors fell 4.4 percent to 400 million dollars.By country, demand from major economies weakened more or less. Exports to China, including Hong Kong, fell 3 percent to 5.5 billion dollars in January, with shipments to Japan and the United States dropping 6.6 percent and 13.7 percent respectively. Outbound shipments to the debt-saddled European Union (EU) tumbled 33.6 percent on-year to 850 million dollars last month.