FAS/Seoul Monitoring of Media Reporting on Agricultural Issues 

Today's Date: Friday 16,  2024

For Coverage:  February 2 ~  15, 2024

The Increase in Profits CJ was Hoping For Its Food Business
http://www.foodnews.co.kr/news/articleView.html?idxno=106753
Summary:  CJ CheilJedang’s food business reached sales of 11.2644 trillion won last year (1.4%+) and an operating profit of 654.6 billion won (4.9%+) due to its strategic distribution, overseas business sales surpassing its domestic sales and the increased sales in their primary products and newly released products.  Although CJ’s operating profits decreased due to the burden of rising raw sugar prices, the sales of their high-margin products, specifically specialty amino acids, were exceptional.  In 2024, CJ plans on expanding further into the North American market with Global Strategic Products (GSP) and K-Street Foods while entering the halal market of Northern Europe and Southeast Asia.  Within the domestic market, they will continue to invest in their highest profit products while introducing new differentiated ones to achieve qualitative growth in all markets.

Korea's Continuous Investment in Smart Farm Technology
https://www.koreatimes.co.kr/www/tech/2024/02/129_368631.html
Summary:  The Korean government in conjunction with KOTRA, will be establishing four new offices to show their support of the exportation of smart farm technology in Kuwait, Kazakhstan, Azerbaijan and Australia.  These locations were selected based on the demand for local smart farm support centers and the project orders that Korean smart farms received.  The expansion of smart farm offices will aid in the process of not only promoting smart farming in overseas countries but also present a solution to the country's agricultural sector which is currently suffering from the diminished workforce and unpredictable weather conditions resulting from climate change.

Whiskey Imports on the Rise

https://www.koreaherald.com/view.php?ud=20240208050029&ACE_SEARCH=1
Summary:  With the consistent rise in demand for affordable whiskey, South Korean whiskey providers have been seeking new import markets.  They are currently in the market for lesser-known whiskey-producing countries such as Australia or Taiwan, rather than major whiskey producers from the UK, the US and Japan where their products are more expensive and less available.  South Korea is planning on importing more non-major whiskey-providing countries, making way for more diverse options to local customers.

AliExpress is Growing as a Threat
https://koreajoongangdaily.joins.com/news/2024-02-09/business/industry/NEWS-IN-FOCUS-AliExpress-clinches-Korean-market/1977588
Summary:  AliExpress has dedicated an entire segment called “K-venue,” specifically for Korean items with zero sales fee, which has grown in popularity amongst LG Household & Health Care and Aekyung Industrial.  With China taking hold as Korea's top overseas direct purchasing market, domestic e-commerce firms such as Naver Shopping and Coupang are concerned with a potential decline among local sellers, as it could negatively impact the sales and transaction volumes of their open market platforms.  As of January, AliExpress has attracted more than 20 companies such as Samdasoo and Lotte Chilsung with its exemptions from listings and sales commissions, further making their platform competitive.

Less Burden on Apples and Pears
http://www.foodnews.co.kr/news/articleView.html?idxno=106735
Summary:  The Ministry of Agriculture, Food and Rural Affairs and the Ministry of Oceans and Fisheries supplied a total of 256,000 tons of 16 crucial products purchased during the Lunar New Year holiday through the use of the government's stockpiles and contracted cultivation supplies.  Despite inflation, they were able to maintain the average price of Lunar New Year products such as cabbage, pears and apples, 3.2% lower than last year.  To further alleviate the burden of purchasing agricultural products, they increased their budget by three times, totaling approximately 94 billion won to provide the option to purchase them at less than half the price at local supermarkets and a discount of 30% through mobile gift certificates.  They plan on continuing to offer more promotions and discount events to maintain the lower price of agricultural products such as seafood even after the Lunar New Year holiday.

Surging Grocery Prices Escalate Shopping Costs Ahead of Lunar New Year
https://www.koreatimes.co.kr/www/biz/2024/02/602_368265.html
Summary:  The Korean government announced that consumer prices rose 2.8% in January 2024 compared to the same month in 2023, the first time in six months that inflation fell to the 2% range.  However, consumers in Korea are not feeling a discernible difference in the prices of goods compared to a year ago.  The fresh food index surged 14.4% compared to last January and prices of agricultural products marked 15.4% range growth for two consecutive months.  Fruit prices notably showed a 28.1% increase month-on-month, which is the most significant rise since fruit prices soared about 31.9% in January 2011.  Additionally, the inflation rate for dining out in January also reached 4.3%, 1.5 times higher than the general average.  A finance ministry official said that the government will continue to its efforts to stabilize the prices of consumer goods as a way to ease the financial strain on consumers, providing discount services for agricultural, livestock, and fishery products as the Lunar New Year holiday approaches.

A Major Hit in Japan - Pulmuone's Tofu Bar
http://www.foodnews.co.kr/news/articleView.html?idxno=106705
Summary:  Pulmuone sold 58 million units of their completely plant-based protein product, a Tofu Bar, in Japan.  Originally launched in November 2020, the sales of the Tofu Bar increased by 3.4 times within the past two years, selling an average of 80,000 units in over 30,000 convenience stores daily.  In order to meet the constant demand, Pulmuone has expanded its local production lines and plans to increase its monthly production capacity to 3 million units by March.

Exports of Korean Sauces and Condiments Hit a Record High
http://news.heraldcorp.com/view.php?ud=20240206000465
Summary:  Due to the growing popularity of Korean food and cultural content, red pepper paste called "gochujang", soy sauce and many other seasonings reached shipments amounting to $384 million in 2023, a 6.2% increase on-year.  South Korea exported around 131,800 tons of seasonings, with sauces amounting to the largest share - $241 million.  The United States was the primary exported market totaling 21.8 percent, followed by China and Japan.

Increased Exports of a ‘Halal’ Korean Rice Beverage
https://www.foodnews.co.kr/news/articleView.html?idxno=106683
Summary:  Birak Sikhye is a traditional Korean rice beverage brand launched by Paldo in 1993, allowing the easy enjoyment of a rather lengthy manufacturing process that mainly utilizes domestic malt and gluten-free rice.  Paldo received a 'halal' certification from the Indonesian Halal Agency (BPJPH) for five of its beverages, including birak sikhye.  Currently, Paldo has increased the convenience of the product by removing the rice grains from the drink and localized its design to be available in all types of markets in Indonesia. They also plan on expanding their halal-certified items and obtaining additional halal-certifications for their already existing ones for further expansion into the Halal market.

Korean Dietary Supplements Makers Eye Chinese Market
https://www.koreaherald.com/view.php?ud=20240204000156
Summary:  Korean dietary supplement manufacturers are accelerating their entries into the growing Chinese market.  According to a report released by the Korea Trade-Investment Promotion Agency, the Chinese dietary supplements market grew 3 percent year-on-year to reach 73 trillion Korean won ($54.5 billion) in 2022.  Korea Ginseng Corp. (KGC), the country’s leading ginseng manufacturer, recorded sales of 75.2 billion KRW ($56 million) in the Chinese market in 2021 and 90.7 billion KRW ($67 million) in 2022.  A KGC official said, “the Chinese market accounts for the largest proportion of the company’s overseas sales.  We will continue to develop and introduce new dietary supplements to expand its market share in China.”  In addition, Daesang Wellife, a dietary supplements arm of Korean food giant Daesang Group, is also increasing efforts to make a foray into the Chinese market, with its plan to establish a joint venture and build a dietary supplements manufacturing facility in China this year.

A Rising Whiskey Consumption Trend in Korea… “Highball”
https://www.koreatimes.co.kr/www/tech/2024/01/129_367908.html
Summary:  Regardless of age and generation, highball (a mixed alcoholic drink) has become a mega-hit in Korea since last year.  On the back of the highball’s rise, whiskey sales have soared off the charts.  According to government data, Korea’s imports of whiskey-based liquors such as scotch, bourbon and rye amounted to 30,586 tons, a 13.1% increase year-on-year.  Many highball drinkers consume affordable whiskeys mixed with tonic water, flavored soda or other savory additions.  Imported whiskey sales in 2023 accounted for $259 million, a 2.7% decrease, thus increasing the market share of low- and medium-priced whiskeys.  On the other hand, soaring whiskey consumption has also reduced the consumption of wine.  Wine imports last year amounted to 56,000 tons, a 20.4% decrease compared to the previous year.  Wines were increasingly sought among people who drank at home during the pandemic but the change of disease control regulations and social sentiment brought the new trend.

Korea to Nurture 100 Michelin-starred Korean Restaurants Abroad by 2027
https://www.koreatimes.co.kr/www/tech/2024/02/129_368126.html
Summary:  Minister of Agriculture, Food and Rural Affairs, Song Mi-ryung, announced that the ministry plans on expanding the number of Korean restaurants overseas to 15,000 while cultivating specific restaurants to be reputably known via the Michelin Guide on a global scale.  Their initiative also includes updating South Korea's food guidebook with detailed information and tips to eat or pair them with Korean traditional alcoholic beverages.  The ministry seeks to popularize Korean terms related to national foods and organize global food conferences to promote the Korean food industry even further.

Mom's Touch Intensely Intervenes its Affiliates with its First Beef Burger
https://www.koreatimes.co.kr/www/tech/2024/02/129_368118.html 
Summary:  Mom's Touch, a chicken burger chain, has attempted to increase its competitiveness by expanding its menu offering through the introduction of beef burgers.  To fully support this decision, Mom's Touch has financially supported about 500 affiliate stores for the necessary equipment required to prepare the beef burgers.  With this, it has systemized its customer management under a partnership and implemented a hygiene rating system from the Ministry of Food and Drug Safety.  Their efforts have led to fewer administrative measures, sales 30% higher than other franchises and overall greater profitability within the fast-food market.

Additional Purchase of Rice to Stabilize Prices
https://www.foodnews.co.kr/news/articleView.html?idxno=106660
Summary:  To stabilize rice prices, the government decided to purchase an additional 50,000 tons from the private sector and use a total of 100,000 tons for food aid this year.  The Ministry of Agriculture, Food and Rural Affairs discussed the current rice supply, demand and price trends at the government’s policy consultation with National Assembly members and announced the unanimous agreement on the need for additional government measures to stabilize rice prices.  The government determined that the decline in rice prices was due to the temporary inventory burden on production distributors such as Nonghyup.  The government plans to quickly implement more related measures and continuously monitor rice prices and inventory situations to ensure that rice prices remain stable through drones, AI technology and policies such as the ‘preemptive supply and demand management’.

Price Surges on Agricultural Products While Oil Prices Fall

https://koreajoongangdaily.joins.com/news/2024-02-02/business/economy/Inflation-sees-smallest-jump-in-six-months-as-oil-prices-fall-but-apples-surge/1972960

Summary:  In January of 2024, there was a decrease in inflationary pressure as Korea's inflation dropped below 3 percent.  Although inflation in South Korea has slowed down, core inflation has gone up by 2.6 percent on-year.  The cost of daily necessities such as food, clothing and housing has increased by 3.4 percent while prices of agricultural, livestock and fish products have surged 8 percent.  Of the agricultural products, prices of apples and tangerines have spiked 56.8 percent and 39.8 percent respectively.  The South Korean government is expecting the inflationary pressure to decrease at a slower rate of around 2 percent at the end of the year.

Online Shopping Transactions are the Highest of All Time

https://www.hankookilbo.com/News/Read/A2024020113530005035

Summary:  Due to online shopping’s convenience and low price, the amount of online shopping transaction exceeded 200 trillion won, an increase of 8%.  According to the figures released by Statistics Korea, post-pandemic there were increases in several areas: travel and transportation services (44%) and e-coupon services (34.9%).  In terms of total transactions value, food and beverages (13.1%), food services (11.6%), and travel and transportation services (10.6%) were the highest.  Last year, overseas direct sales were 1.6561 trillion won (10.1%-) while overseas direct purchases were 6.7567 trillion won (26.9%+), amounting to a deficit of 5.1006 trillion won.

‘Ramyun Library’ Delivers Ultimate Noodle Experience
https://www.koreatimes.co.kr/www/culture/2024/02/141_368003.html
Summary:  CU, one of leading convenience store chains in Korea, opened a new branch store in Seoul, the Ramyun Library, on December 4, 2023.  The Ramyun Library has transformed into a culinary hotspot with an eye-opening collection of more than 200 varieties of ramyun, redefining the concept of the existing convenience stores.  Its focal point is a striking 100-compartment display rack dedicated solely to packaged ramyun or Korean instant noodles.  The vast display features a curated collection of 105 packaged ramyun, alongside 15 foreign noodle dishes, with an additional 120 types of cup ramyhun.  Since its grand opening, an average of 600 to 700 customers have been visiting the Ramyun Library daily.  Last December, its sales reached 15,000 ramyun packets, marking a 10-fold increase compared to other convenience stores.