FAS/Seoul Monitoring of Media Reporting on Agricultural Issues

Today's Date: Friday,  August  21, 2020

For Coverage: August 18 ~  21, 2020

Naver.com Launches On-line Grocery Shopping Mall in Collaboration with Conventional Retailers

https://www.donga.com/news/Economy/article/all/20200820/102580481/1

Summary: Naver.com, the leading internet portal site in South Korea, reported on August 21 that it launched 'Naver Shopping Mall' in collaboration with conventional retail stores - Home Plus (hypermarket chain), GS Retail (convenience store chain), and Hanaro Mart (hypermarket chain).  The shopping mall offers some 23,000 products in both food and non-food categories available from the conventional stores.  Orders made by consumers are home delivered from the nearest partner store within a day.  Naver.com has been investing heavily in on-line shopping recently.  It became the second largest on-line shopping platform in South Korea this year by achieving a 52.6 percent of on-line shopper access rate, coming very close to the industry leader Coupang who has a 54.7 percent access rate.  Home Plus said the partnership with Naver.com will likely increase its on-line shoppers by 1.6 million people this year.

A Chinese Infant Formula Processor Starts Production in Korea … All Production will be Exported

https://www.hankyung.com/society/article/2020081944151

Summary: Jintao Korea, a subsidiary of Chinese infant formula processor Sungwon International Group, started test production in its facility in Incheon, Korea on August 18.  The facility, which has 20,000 metric tons of annual processing capacity, is part of Sungwon International Group's strategy to produce top quality infant formula using Korean milk.  Jintao Korea plans to produce 2,000 metric tons of products by the end of this year.  All production will be exported to China, south Asian countries, and middle east countries.  HAM, another Chinese infant formula processor, invested in Korea and established a production facility in 2018 with the same strategy as Sungwon International Group.

Summary: The Rural Development Administration (RDA) reported on August 19 outcomes of its analysis of 1,486 families’ food purchases over the last 10 years (2010 - 2019).  According to RDA’s report, key themes behind changes in consumer food purchases over this time were: young consumers, health, convenience, and diversified shopping channels.  Consumers in their 20s’ and 30s’ increased food purchases the most during this period, increasing 68 and 30 percent respectively. Consumers in their 60s' were very health-oriented; their purchase of blueberries and nuts increased by 59 percent and 31 percent respectively.  Convenience was important for all age groups, leading to increased on-line shopping.  Since COVID-19, there has been increased demand for prepared foods and locally produced agricultural products.

Korean Department Store Sales Recover to 2019 Level in June, July

https://www.hankyung.com/economy/article/2020081898941

Summary: The top three Korean department store chains, Lotte, Shinsegae and Huyndai, reported that their cash-register sales continued to recover in June and July to their 2019 level.  Shinsegae's sales were 3 percent and 0.9 percent higher in June and July compared to the same months last year respectively.  Hyundai's sales were 1 percent and 0.3 percent higher during these months.  Lotte's sales came close to last year’s level during these months.  Sharp growth in electronics and luxury consumer brands were key driver for the sales recovery in all chains.   Strong growth in on-line sales was another driver.  For example, Shinsegae reported that its on-line sales accounted for 11.3 percent of overall sales this year, up from 7.7 percent in 2018.

https://www.hankyung.com/economy/article/2020081758381

Summary: EMART, the leading hypermarket grocery store chain in South Korea, reported that its sales of imported fruit in August (through 13th) increased significantly compared to the same period last year.  The extended rainy season in Korea resulted in reduced supply and poor quality for local fruits.  Imported fruits with the highest sales growth were oranges (up 209 percent), mangos (up 39 percent), and cherries (up 33 percent).  In contrast, sales of local watermelon and peaches declined 20 percent and 10 percent respectively during the period.  Lotte Mart, another major hypermarket chain, also reported strong sales growth in imported fruits in August.