Indonesia - South Korea Trade 2023 Q1: Volatile Growth

Key Market Takeaways: Indonesia - South Korea Trade

The bilateral trade relationship between Indonesia and South Korea showed mixed growth with high volatility in Q1 2023.

• Economic Pulse: Indonesia held a narrow $30M trade surplus ($2.85B exports vs. $2.82B imports), but exports swung sharply from +29% YoY growth in January to -32% by March.
• Exchange Structure: Indonesia - South Korea trade statistics reveal a resource-for-tech complementarity—Indonesia supplies 48% mineral fuels (HS27) while importing South Korea’s high-tech machinery (HS85, 20% share).
• Strategic Interdependence: The partnership is structurally imbalanced, with South Korea capturing higher value-add in manufacturing while Indonesia remains a commodity exporter.

This bilateral trade snapshot is based on verified customs data from the yTrade database.

Indonesia-South Korea Trade Trend in Q1 2023

Indonesia Export Performance: Shipments to South Korea

• Total Volume: $2.85B in Q1 2023.
• Growth Trend & Context:
  • YoY growth was mixed: +29.18% in January, but sharply reversed to -31.81% by March.
  • No specific trade news or policy changes were reported to explain the volatility.
• Key Volatility: February saw a steep -15.75% MoM drop, followed by another -5.29% decline in March.

Indonesia Import Performance: Sourcing from South Korea

• Total Volume: $2.82B in Q1 2023.
• Growth Trend & Context:
  • YoY declines persisted throughout the quarter, ranging from -2.57% to -6.79%.
• Key Volatility: March recorded the highest monthly import value ($1.07B), up 28.91% MoM.

Indonesia - South Korea Trade Balance & Market Dynamics

• Net Position: Narrow trade surplus of $30M (Exports: $2.85B vs. Imports: $2.82B).
• Relationship Status: Near-balanced trade, with Indonesia maintaining a marginal exporter role.

Indonesia Import Trend from South Korea 2023 Q1 (Source: yTrade)**

Indonesia Export Trend to South Korea 2023 Q1 (Source: yTrade)**

Get Historical Indonesia South Korea Trade Records

Indonesia-South Korea Top Trading Products in Q1 2023

Indonesia Export Profile: What Does Indonesia Sell to South Korea

• Top Commodity: HS Code 27 (Mineral fuels, oils, distillation products) dominates with 47.93% share.
• Demand Driver: South Korea uses these for industrial processing and energy needs.
• Concentration: Highly concentrated, with HS Code 27 alone accounting for nearly half of exports.

Indonesia Import Profile: What Does Indonesia Buy from South Korea

• Top Commodity: HS Code 85 (Electrical machinery, equipment) leads at 19.95% share.
• Dependency Nature: Critical technology dependency, reflecting South Korea’s strength in high-tech manufacturing.

Indonesia - South Korea Trade Relationship Dynamics

• The Exchange Model: Resource-for-Tech Complementarity. Indonesia supplies raw materials (fuels, ores) while importing high-tech goods (machinery, electronics).
• Value Chain Position: South Korea holds the higher value-add position, exporting advanced manufactured goods, while Indonesia primarily provides commodities.

Import Analysis by Product: South Korea to Indonesia (Source: yTrade)

Export Analysis by Product: Indonesia to South Korea (Source: yTrade)

Check Detailed Indonesia-South Korea Trade HS Code Breakdown

Future Outlook & Strategic Recommendations

Forecast

Indonesia’s trade with South Korea in Q1 2023 showed volatility, with exports swinging between sharp growth and decline, while imports remained subdued. Given the structural reliance on mineral fuels (HS Code 27) for exports and high-tech machinery (HS Code 85) for imports, the Indonesia - South Korea trade forecast hinges on commodity prices and South Korea’s industrial demand. Expect moderate recovery in Q2 as energy demand stabilizes, but exporters must brace for continued volatility due to global market fluctuations. The near-balanced trade surplus is likely to persist, but Indonesia’s over-reliance on raw materials leaves it vulnerable to price shocks.

Strategic Moves

• Diversify Export Composition: Reduce dependence on HS Code 27 by promoting secondary export sectors like processed agricultural goods or textiles, which have untapped potential in South Korea.
• Lock in Long-Term Tech Supply Contracts: Importers of South Korean machinery (HS Code 85) should negotiate multi-year agreements to hedge against supply chain disruptions and price spikes.
• Monitor Energy Market Trends Closely: Exporters of mineral fuels must track global oil and gas dynamics to time shipments strategically, avoiding periods of oversupply or demand slumps.

Frequently Asked Questions

How did Indonesia - South Korea trade perform in 2023 Q1?

Indonesia's exports to South Korea totaled $2.85B in Q1 2023, with mixed YoY growth, while imports from South Korea reached $2.82B, showing persistent YoY declines.

What are the top exports from Indonesia to South Korea?

Mineral fuels, oils, and distillation products (HS Code 27) dominate Indonesia's exports to South Korea, accounting for 47.93% of total shipments.

What does Indonesia import from South Korea?

Indonesia primarily imports electrical machinery and equipment (HS Code 85) from South Korea, making up 19.95% of total imports.

What is the trade balance between Indonesia and South Korea?

Indonesia maintained a narrow trade surplus of $30M in Q1 2023, with near-balanced trade between the two countries.