Lowest Level Since 2024... Negative Assessments Spread Across Sales, Domestic Demand, and Exports
[NEWSMP]
Experts in the biohealth industry have become increasingly pessimistic about economic conditions.
As negative sentiment toward both domestic demand and exports increased significantly, the overall business conditions index fell to its lowest level since 2024.
According to the 'Manufacturing Business Survey Statistics: Q1 2026 Results and Q2 & Annual Outlook' published by the Korea Institute for Industrial Economics & Trade, the Business Survey Index (BSI) for business conditions in the biohealth manufacturing sector dropped to 78 in the first quarter.
The BSI is calculated based on a survey of approximately 1,500 domestic manufacturers. Respondents choose from seven options ranging from "significantly decrease (deterioration)" to "significantly increase (improvement)", with "no change" as the midpoint. The responses are then converted into an index value ranging from 0 to 200.
With 100 as the benchmark (indicating no change from the previous quarter), a value closer to 200 indicates that more respondents expect improvement, while a value closer to 0 indicates more expect deterioration.
This marks the first time since the first quarter of 2024 that the biohealth industry’s current business conditions BSI has fallen below 80. Sales and domestic shipments also dropped to 73 and 74, respectively, both falling below 80 for the first time since the first quarter of 2024.
Exports declined to 85, falling below 90 for the first time in a year, after recording 84 in the same quarter last year.
Facility investment stood at 100, maintaining a three-digit level as negative and positive assessments balanced out, while operating ratio and employment both declined to 94.
Meanwhile, raw material prices rose to 130, and both inventories and product prices remained in the triple digits. Ordinary profits and financial conditions dropped to 80 and 77, respectively, reflecting increasingly negative sentiment.
The BSI outlook for the second quarter significantly exceeded the current figures of the first quarter, but negative sentiment increased compared to the previous outlook.
The outlook for business conditions fell from 97 to 94, sales from 98 to 94, and domestic shipments from 99 to 95. Exports, which had reached 103 in the first quarter, declined to 99, falling into the double digits.
Operating ratio and employment also fell from 101 to 98 and from 102 to 96, respectively, sliding into the double digits. Ordinary profits and financial conditions declined further from 92 to 89 and from 92 to 88, both dropping below 90.
Facility investment remained in the triple digits at 101, although it declined from 103 in the first quarter.
Additionally, raw material prices rose further to 123, while both inventories and product prices remained in triple digits at 101.
Jaehoon SongㆍHangi Lee, Newsmp
(newsmp@newsmp.com)
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