Industrial production, consumption, and facility investment all fell in April. It was the first time in eight months, since August last year, that all three indicators declined together. In particular, petroleum refining recorded its steepest drop in about 38 years since 1988, suggesting the impact of the "Middle East war" has begun to become visible.
According to the "April 2026 industrial activity trends" that the Ministry of Data and Statistics (MODS) released on the 29th, last month's all-industry production index (seasonally adjusted, excluding agriculture, forestry and fisheries) was 117.8 (2020=100), down 0.6% from the previous month. After rising in February (2.1%) and March (0.4%), it turned negative again.
Production fell across mining and manufacturing, services, and construction. Mining and manufacturing output decreased 0.7% from the previous month, and within it, manufacturing production fell 0.8%.
In particular, petroleum refining output fell 19.4% from the previous month. This was the largest decline in 37 years and 11 months since May 1988 (-22.1%). Lee Du-won, Deputy Director General for economic trend statistics at the Ministry of Data and Statistics (MODS), said, "Petroleum refining production appears to have fallen sharply due to disruptions in crude oil supply and demand caused by the Middle East war."
Automobiles also fell 10% from the previous month. On this, the Deputy Director General said, "In addition to supply disruptions caused by a fire at a car parts company in Daejeon in March, there appears to have been pent-up demand for major new models from May onward." In contrast, semiconductor production rose 3.1%.
Service output fell 1%. It was the biggest decline in 4 years and 2 months since February 2022 (-1.7%). While information and communications rose 4.3%, finance and insurance (-7.7%), wholesale and retail (-1.5%), and health and social welfare (-2.2%) declined.
Consumption fell 3.6% from the previous month. It was the largest drop in 26 months since February 2024 (-3.7%). Durable goods and nondurable goods fell 11.1% and 1.1%, respectively. Among nondurables, vehicle fuel (-8.3%) fell sharply, which is attributed to high oil prices stemming from the Middle East war and the implementation of the odd-even vehicle restrictions.
Facility investment fell 3.6%. Investment in machinery, led by semiconductor manufacturing equipment, increased slightly, but investment in transportation equipment weakened due to a base effect from aircraft introductions a month earlier. Construction completed declined 1.4%.
However, business cycle indicators are showing strength. The coincident composite index cyclical component, which reflects current conditions (100.2), rose 0.2 percentage point from the previous month, and the leading composite index cyclical component, which signals future phases (104.1), rose 0.6 point. The two indicators have risen together for three straight months.