Market Information > Food News Clipping
Food News Clipping
April 10-16, 2020
FAS/Seoul Monitoring of Media Reporting on Agricultural Issues
Today's Date: Thursday, April 16, 2020
For Coverage: April 10 ~ 16, 2020
2040 Generation Shop Online for Their Parents
Summary: As it has become difficult to go outside, due to COVID-19, the 2040 generation has increased its filialduty by conducting the online purchase on behalf of their parents. According to a survey conducted by Auction, anonline shopping app, 89% of the 2,564 people surveyed replied that they have shopped online on behalf of theirparents.
MAFRA to Reduce Loan Interest for Farmers Suffering from COVID-19
Summary: The Ministry of Agriculture, Food and Rural Affairs (MAFRA) will reduce the interest for governmentpolicy loans and also make it easier for farmers suffering from COVID-19 to receive the loans. MAFRA had earlierannounced that it would provide a loan up to 60 billion won. As of April 10, a total of 527 farmers have applied forthis loan and after undergoing assessment by the National Agricultural Cooperative Federation, a total of 244farmers were able to receive a loan of 6.2 billion won.
Corona Changes the Dining Table to ‘Shintoebuleui (body and soul are not different)’···Environment FriendlyFood OK, Imported Food No
Summary: According to a survey conducted by McKinsy & Company among 5,000 people living in the Asiancountries, 83 percent of Koreans replied that they would purchase Korean food products. The rate of dining atrestaurants dropped 30-70 percent in the Asian nations, whereas shopping food products online have increased by16-70 percent. Among the 1,500 Koreans that were surveyed, over 40 percent of the people replied that they aregoing to spend more time in checking the safety of food when purchasing food items. Only 17% of the Koreansinterviewed replied that they would purchase imported food products.
Coupang Becomes Top On-line Retailer in South Korea … Reports $6.2 Billion of Sales in 2019, Up 64%
Summary: Coupang Co. reported 7.1 trillion won ($6.2 billion USD) in sales in 2019, up 64.2 percent from 2018. Asa result, Coupang became the largest on-line retailer in South Korea, surpassing the former leader, eBayKorea. More importantly, Coupang reported 700 billion won ($600 million USD) in operation losses, down 41.7percent from 2018. Coupang said the aggressive investments it made for an efficient logistics network ofwarehouses, direct-hire delivery truck fleet, and state-of-art information technology systems had been the causefor the hefty operation losses it saw in fiscal years 2017-2019. The number of distribution warehouses underCoupang increased to 168 in 2019, up 83 from 2018. Marketers agree that Coupang should be able to generateprofits in the near future as its sales will expand further based on its strong business foundation.
Our Home Launches Meal Service in Apartment Housing
Summary: Our Home, a leading contract feeding foodservice company in South Korea, announced that it launcheda meal service business targeting apartment housing earlier in April. The first client it provided service to was thePenta Port apartment complex (800 households) in Chunan-si. Our Home’s meal service offers breakfast, lunch,and coffee beverages in the apartment community center every day. The price for a meal is 5,000 won to 10,000won ($4 to $8 USD) each.
9 Out of 10 Koreans Continue to Practice Social Distancing
Summary: According to a survey by Incruit Korea, 9 out of 10 Koreans continued to practice social distancingmeasures. In the survey of 2,232 adults during the week of April 9, 90.2 percent of people answered that theywere actively restricting social contacts and activities to prevent COVID-19 risk. People in their 40's indicated thehighest level of social distancing participation (94.7 percent), followed by 30's (91.5 percent) and 50's (90.9percent). People in their 20's indicated the lowest participation (86.2 percent).
Job Announcements in March Down by 32.7 Percent from Last Year due to COVID-19
Summary: Saramin, a leading job search service in South Korea, reported that the number of job announcementsin March declined by 32.7 percent compared to the same month last year. Saramin said the decline in jobannouncements expanded since February (-15 percent) after peaking in January (+8.3 percent). Jeju, a majortourism destination, led the decline in job announcements (-47.5 percent) in March, followed by Daegu, the areahit hardest by COVID-19 (-41.6 percent), Seoul (-34.2 percent), and Busan (-31.4 percent). The education sectorhad the highest decline (-37.3 percent), followed by Banking & Finance (-35.2 percent), Media & Design (-35.2percent), and Retail (-33.4 percent).
Premium Cafe Franchises Report Strong Outcomes in 2019 Despite Aggressive Competition from Low Price Cafes
Summary: A notable trend in the Korean cafe industry has been rock-bottom price (900 won / $0.75 USD)Americanos launched by low price cafes since last year, which reflects elevated market competition. Despite theaggressive pricing competition, leading premium cafe franchises, including Ediya, Two-Some-Place, and StarbucksKorea, reported strong financial outcomes. Ediya, which has over 3,000 stores under the franchise, reported 19.4billion won ($16 million USD) in operation profits in 2019, up 10 percent from the previous fiscal year. Ediya added300 new stores in 2019 and increased its cash-register sales 10 percent to 220 billion won ($183 millionUSD). Two-Some-Place saw 20 percent growth in its cash-register sales and operation profits in 2019. It opened120 new stores, which increased the number of stores under the franchise to 1,189. Starbucks Korea reported 175billion won of operation profits ($146 million) in 2019, up 21 percent from 2018. Marketers agree that the Koreancafe market continues to expand, offering new growth opportunities for the leading premium cafefranchises. Korean imports of coffee beans has grown at a 13 percent Compound Annual Growth Rate (CAGR)since 2012. Each Korean consumed 353 cups of coffee as of 2018, which was 2.7 times larger than world average(132 cups). Marketers forecast tighter competition in the industry in coming years.
Local Growers Introduce Eureka Blueberry
Summary: Lotte Mart launched Eureka blueberry by staging an in-store promotion on April 13. Eureka blueberry isa big size, high-brix variety that local growers in Gimhae-si developed. A 100 gram pack of the blueberry wasoffered in Lotte Mart for 7,980 won ($6.4 USD).
GS25 Expands Home-delivery Stores to 2,000
Summary: GS25, a leading convenience store chain in South Korea, reported that it expanded the number of storesoffering home-delivery service from 1,350 to 2,000 starting April 13. GS25 said the home-delivery service offeredin 1,350 stores saw the number of sales grow 12.7 fold in March (10.4 times by value) during the COVID-19outbreak. Other leading convenience store chains, including CU and Seven Eleven Korea, also plan to expand theirhome delivery services.
GS25 Offers Carnation Flower Corsages for Home Delivery
Summary: GS25 started to take on-line home delivery orders for upcoming 'Parents Day (May 8)' carnation flowercorsages. It is a local custom for children to present carnation flower corsages to parents on Parents Day (May8). GS25 explained that the service would help consumers avoid COVID-19 risk but still show their love to parents.
All Travelers from the U.S. are Mandated to Take a COVID-19 Test upon Arrival in South Korea from April 13
Summary: The Korea Center for Disease Control (KCDC) announced that all travelers from the United States musttake a COVID-19 testing upon arrival beginning midnight April 13. Travelers from European countries were alreadyrequired to undergo testing. KCDC explained that this requirement is due to elevated COVID-19 risk in the UnitedStates as the number of people infected with COVID-19 exceeded 530,000 as of April 13 with over 20,000 deaths.
Hotels Saw 580 Billion Won Decline in Sales in March due to COVID-19
Summary: According to a survey of 200 major hotels by the Korea Hotel Association (KHA), the industry saw salesdecline by 580 billion won ($470 million USD) during March due to the COVID-19 outbreak. Hotels in generalreported a very low occupancy rate and some major five-star hotels are temporarily closing. According to HanaTour, a leading tourism service company in Korea, the number of hotel and air ticket reservations it serviced forthe second quarter (April through June) this year was 90 percent less from the same quarter last year.
Crab Catch in the West Sea Likely to Increase by 8% This Spring
Summary: The Korea National Fishery Research Institute (NFRI) reported on April 12 that the crab catch in the westsea this spring season (April through June) will increase by 8 percent from last year to 760 metric tons according toits survey. NFRI said the temperature on the bottom of the sea during last winter was 8 degree Celsius or higher,allowing fair growth for crab. The west sea is the main area for local crab catching.
Hyundai Department Store Launches Premium Australian Grapes with an Instore Promotion
Summary: Hyundai Department Store sungnam branch staged an instore promotion on imported premium grapesfrom Australia on April 12. Varieties introduced were ‘Candy Heart (red)’ and ‘Cotton Candy (white)’. They wereoffered for 8,000 won ($6.6 USD) and 7,000 won ($5.8 USD) respectively per 500 gram pack.
Baemin Withdraws Its New Pricing Policy due to High Opposition from Restaurants
Summary: Baemin, the leading restraunt meal on-line order-delivery service in South Korea, announced on April 11that it withdrew its new pricing policy implemented on April 1. Baemin apologized to client restaurants for causingconfusions and economic burden as the new pricing policy reportedly increased the fee for the servicesignificantly. Baemin’s new pricing policy, which charged 5.8 percent of the sales, will return back to the old, flatpricing policy of charging 88,000 won (about $70 USD) per restaurant banner per month.