The photo shows export-bound automobiles lined up at Pyeongtaek Port in Gyeonggi Province on November 14. (Yonhap)
SEOUL, Dec. 8 (Korea Bizwire) — Chinese manufacturers have sustained a sweeping low-price export strategy for more than two years, intensifying competitive pressure on South Korean exporters across a range of sectors, a new study shows.
According to a report released Sunday by Jih Man-soo, senior research fellow at the Korea Institute of Finance, Chinese export prices have fallen steadily since the second quarter of 2023 and continued to decline through September 2025.
The trend persisted even after the pandemic-era spike in shipping and production costs — which briefly drove up export prices in 2021 and 2022 — faded from the global supply chain.
The price reductions reflect deepening industrial overcapacity in China, particularly in manufacturing, prompting firms to undercut one another in global markets to secure volume growth, Ji said. The result has been a form of “self-defeating” competition: lower unit prices have increased export volume at the cost of profitability.
Price declines were noticeable in major export categories, including autos, batteries, solar panels and steel, with the sharpest drops seen in consumer goods. The report found that China’s low-price strategy has transmitted directly into Korea’s export pricing.
The photo shows stacks of containers at Busan’s Sinseondae Terminal on December 1. (Yonhap)
Between 2018 and the third quarter of this year, Korea’s export price index closely mirrored the trajectory of China’s, particularly in sectors where Chinese firms hold large global market shares.
Automobiles, batteries and steel showed clear pricing pressure this year, with Korean manufacturers either lowering export prices or limiting planned price increases, compared with 2024.
The Chinese government has recently expressed concern about the effects of ruinous domestic competition and has begun limited restructuring in industries such as electric vehicles and batteries.
But Ji expects these efforts to have only “modest” influence on export prices, noting that policy responses are aimed mainly at curbing price competition within China rather than reshaping global market dynamics.
To respond effectively, Ji recommends that Korean consumer-goods companies focus on brand strength and product differentiation rather than matching Chinese prices.
In capital goods and intermediate components, he said, firms should prioritize stable long-term relationships in global supply chains over short-term price reductions, leveraging interdependence with overseas buyers instead of competing solely on cost.
M. H. Lee (mhlee@koreabizwire.com)
