FAS/Seoul Monitoring of Media Reporting on Agricultural Issues 

Today's Date: Friday, August 2,  2024

For Coverage:  July 26 ~ August 1, 2024

Last Year’s Food Industry Production Amounted to 108.4875 Trillion KRW, Exceeding 100 Trillion KRW for 2 Consecutive Years
http://www.foodnews.co.kr/news/articleView.html?idxno=109196
Summary:  The Ministry of Food and Drug Safety and the National Food Safety Information Service in Korea announced on August 1^st that the production of the domestic food industry last year amounted to 108.4875 trillion won, a 3.5% increase from 104.819 trillion won the previous year.  Out of the food production, food products (including food manufacturing and processing, manufacturing of food additive, container and packaging) accounted for 69.9 trillion won (64.5%), livestock products were 35.8 trillion won (33%), health functional foods were 2.7 trillion won (2.5%).  Last year’s exports amounted to 7.2343 trillion won which is similar to 7.4444 trillion won the previous year.  Among food products, the production of ready-to-eat food items such as lunch boxes increased 63.4% from the previous year to 964.9 billion won, which was due to a significant increase in the consumption of in-flight meals as the number of overseas trips increased again after the pandemic ended.  The most exported items are ramen, ready-to-eat and convenience foods, and flavored seaweed.  Ramen exports, which is spreading all over the world due to the Korean Wave, reached $952 million, a 24.4% increase from the previous year.  Kimchi exports also hit a record high of $198.79 million, as it is known as a health food that strengthens immunity after the pandemic.  By manufacturers, the production of CJ CheilJedang reached 3.0294 trillion won, a 0.2% increase from 3.0243 trillion won the previous year, followed by Lotte Chilsung Beverage (2.3344 trillion won), Nongshim (2.2969 trillion won), Ottogi (1.5803 trillion won), and Hite Jinro (1.5217 trillion won), respectively.  Last year, the food industry production accounted for 4.9% of the gross domestic product of 2236.3294 trillion won and 19.8% of the gross domestic manufacturing product of 546.664 trillion won.

‘K-Chicken’ Is a Sensation in the United States…  More Than 200 BBQ Stores Waiting to Open
https://www.hankyung.com/article/2024073099431
Summary:  A Korean fried chicken franchise, BBQ, is rapidly growing in the U.S. market.  According to BBQ on July 29, it entered the United States in 2007 and branched out into 29 out of 50 states, including New York, New Jersey, California, and Texas, and 200 stores are waiting to open.  The key to BBQ’s rapid growth is attributed to the unique taste of Korean chicken with seasoning such as soy sauce and ginger in addition to the K-food craze.  For Americans who were previously unfamiliar with Korean chicken, COVID-19 has sharply increased the demand for Korean chicken as a popular delivery food.  In addition, as the United States has currently been suffering from inflation, the fact that there is no difference in the prices when using food delivery service and directly ordering from the store, is also considered one of main factors in their growth.

Institutional Meal Sector Growing in Sales
http://www.goodkyung.com/news/articleView.html?idxno=243237
Summary:  As dining costs continue to increase, the institutional meal sector is expected to see sales growth.  However, some might experience a decrease in operating profit despite the sales growth.  It is estimated that Hyundai Green Food will likely see an 8.2 % increase in sales and a 5.3 % increase in operating profit in the second quarter of this year companies to the same period last year.  Samsung Welstory is expected to see a 9.2% increase in sales and a 10% increase in operating profit.  On the other hand, CJ Fresh way, the largest company in the sector, is expected to see a 5.5 % increase in sales but a 3.4% decrease in operating profit.  Industry insiders commented that, as “lunchflation” continues, demand for institutional meal facilities has gone up.  However, some companies running meal facilities at hospitals are expected to see negative results in their operating profits partially due to hospital strikes.

Korean Beef Farmers Frustrated by the Heat Wave
https://www.yna.co.kr/view/AKR20240731111900052?section=industry/agriculture
Summary:  Mr. Kim, who runs a cattle shed with 270 Korean native cattle (Hanwoo) in Changwon, South Gyeongsang Province, has a lot of worries due to the heat wave in Korea.  With more than 30 years of experience in the livestock industry, he complained, saying that the cost of Korean beef production is increasing due to the recent sharp rise in feed prices, in addition to the heat wave.  He added that the fans installed on the ceiling of the shed are running 24 hours a day, but cows do not show much interest in their feed due to the heat.  According to an Gyeongnam Province official, the Hanwoo price as of July 23 was 17,240 won per kilogram, decreased 15.7% from 20,458 won in a normal year, with an increase in slaughter due to the heat.

Jeju Tangerine Consumption Increases… Sales Up 27%
https://www.yna.co.kr/view/AKR20240731090800056?section=industry/agriculture
Summary:  The preference for Juju tangerines in the market last year increased as a result of soaring prices of fruits such as apples and pears.  According to Jeju Island on July 31, the total sales of tangerines last year amounted to 1.3248 trillion won, up 27.2% (283 billion won) from 1.418 trillion won the previous year.  On the other hand, the total distribution volume accounted for 553,429 tons, down 4.9% from 581,858 tons the previous year.  An official said that while fruit prices in other regions soared due to a drop in production last year, tangerines maintained a high sugar content in good weather conditions and formed a range of high price.

Dairy Farmers and Firms Agree to Freeze Milk Price Amid Inflation
https://www.koreatimes.co.kr/www/biz/2024/07/488_379618.html
Summary:  The Ministry of Agriculture, Food and Rural Affairs (MAFRA) said on July 30 that dairy farmers and the industry have reached an agreement to freeze the price of raw milk to relieve the public burden amid ongoing inflation.  According to MAFRA, the agreement was reached after negotiations that began in June to address the rising production costs.  Following the agreement, the price of drinking milk will be fixed at 1,084 won ($0.78) per liter starting August 1.  The price of milk used to make processed goods such as cheese and powder will be reduced by 5 won to 882 won per liter.  As major milk producers, including Seoul Dairy Cooperative, Maeil Dairies and Namyang Dairy Products, pledged to freeze the retail prices of their plain milk, the MAFRA added that the agreement will also help limit price hikes for other related goods that use milk as an ingredient.

Drinks Companies Accelerating Showcasing of New Ready-To-Drink (RTD) Highball Products
https://www.etoday.co.kr/news/view/2382762
Summary:  Korea’s Ready-To-Drink (RTD) sector is expected to exceed 300 billion KRW and companies are fiercely competing to lead the RTD highball segment particularly, amid the craze for highballs in Korea.  Highballs are typically made with whiskey, but in Korea, they can be made with various recipes and spirits.  CU showcased ‘Fresh Lemon Highball’ last April which constantly runs out of stock due to popularity and saw a 268.5% increase in highball sales in the first half of this year, compared to the same period last year.  Companies are introducing new products to tap into this growing market, such as ‘Evan Williams Burbon Highball’ launched by Shinsegye L&B, ‘Woo-Ryang Highball’ by Woo-Ryang-ye group, and ‘Scotch High’ by Lotte Chilsung.

Apple Prices Fall by 10 Percent
https://www.news1.kr/photos/6785409
Summary:  The price of apples, which were called ‘gold apples’ at a price of 10,000 won each due to a decrease in production last year, showed a decline.  According to the Korea Agro-Fisheries and Food Trade Corporation (aT) on July 28, the wholesale price of Fuji apples was 84,825 won for 10 kilograms and the retail price was 30,871 won for 10 pieces, decreased by 11.65 percent and 9.38 percent, respectively from the previous month.  The officials believe that the supply of early apples and Fuji varieties some farmers and wholesalers stored had an influence on the price of apples.

‘Sugar’ Has the Highest Price Increase Rate of 17.8% in the Second Quarter of 2024
http://www.foodnews.co.kr/news/articleView.html?idxno=109157
Summary:  A survey released by the Korea National Council of Consumer Organizations showed that the price increase rate of sugar was the highest among major daily necessities in the second quarter of this year following the first quarter.  The council keeps track of price trends by evaluating the prices of daily necessities and industrial products at 420 distributors in Seoul and Gyeonggi Province every month.  According to its price analysis on 37 items, prices of 24 items, including sugar, increased compared to the same period last year, and 13 items decreased, showing an average price increase rate of 1.6 percent.  Five items with the highest price increase rate out of 24 items were sugar (17.8%), red pepper paste (10.2%), diapers (8.7%), flavored seaweed (7.1%), and beer (5.8%).  Sugar also had the highest price increase rate of 18.7% in the first quarter.

Dubai Chocolate, Yogurt Ice Cream and Crookies Set New Dessert Trend in Korea
https://www.koreatimes.co.kr/www/culture/2024/07/199_378933.html
Summary:  Until recently, “tanghulu”, a Chinese candied fruit snack, and “yanggaeng,” a jelly-like traditional Korean dessert, were the top two choices for those who have a sweet tooth in Korea.  But recently, Korea’s MZ Generation has turned to new treats, including Dubai chocolate, yogurt ice cream, and the popular crookie, a fusion of croissant and cookie.  Dubai chocolate, which is originated from Dubai-based Fix Dessert Chocolatier and stuffed with pistachios and fried kataifi, has emerged as a social media phenomenon.  It is now being sold at major convenience stores and department stores in Korea.  Yogurt ice cream, served with different toppings ranging from fruit to cheese to granola, also became a hit on social media after a number of influencers and celebrities uploaded its posts.  Since yogurt is high in protein and calcium, it is believed to offer more health benefits than other sugar-coated confectionery products.  With its popularity, the total number of Yoajung stores, one of the most popular yogurt ice cream brands in Korea, jumped from 166 in 2023 to 350 in 2024 nationwide.  Lastly, crookies, which is croissant topped with chocolate chip cookie, has captured the public’s taste in the Korean market, along with “croffle,” a croissant-waffle hybrid, and “crungji,” a biscuit-like flattened croissant.