South Korean manufacturers face rising costs from oil, exchange rates, and shipping

South Korean manufacturers face a triple threat of rising costs in October due to simultaneous increases in international oil prices, exchange rates, and maritime shipping fees. While a falling exchange rate in August had previously acted as a buffer against rising oil prices, the trend reversed in September. Brent crude has fluctuated around $100 per barrel, and the KRW/USD exchange rate has climbed back toward the 1,360 range.

These rising costs are expected to impact manufacturing expenses starting with October shipments due to contract lead times and inventory lags. The increase in maritime freight costs, driven by instability in the Hormuz Strait, further compounds the pressure. Industries such as automotive parts, machinery, metal, and textiles are particularly vulnerable to these fluctuations in raw material and energy costs.