Supermarket Price Tricks Targeting 'Ramen and Bottled Water Hoarding'... Hand Sanitizer Prices Fluctuate Fourfold

Some Supermarkets Raise Product Prices Targeting Shortage... Consumer Complaints
Supermarkets Announce 'Price Maintenance Policy'... No Changes in Wholesale Prices of Ramen and Bottled Water

A ramen display at a local neighborhood supermarket. Not related to the article content. Screenshot posted on SNS.

[Asia Economy Reporter Lee Seon-ae] As the novel coronavirus infection (COVID-19) spreads nationwide, panic buying of items such as ramen and bottled water is surging, and opportunistic price hikes are emerging amid the unstable situation.

On the 26th, numerous posts on internet communities and social networking services (SNS) reported unusual price increases for ramen and bottled water at neighborhood supermarkets. Mr. A said, "Recently, due to panic buying, the shelves at local marts and supermarkets are often empty, and I noticed that the prices of ramen and bottled water have increased by about 100 to 300 won," adding, "Although the rate of increase is not high, isn't this just opportunistic pricing taking advantage of the shortage?" Mr. B emphasized, "I don't know about other neighborhoods, but prices have risen at some supermarkets in my area." Mr. C said, "I went to a neighborhood supermarket yesterday, and the shelves for ramen and bottled water were partially empty," and added, "The price of the ramen brand I always buy increased by 200 won, which seems to be due to the shortage."

Nationwide, essential daily goods such as ramen and bottled water are facing stock shortages not only in large marts but also in small marts and neighborhood supermarkets. The problem is that while large stores have not yet raised prices, price increases are being detected at neighborhood supermarkets.

However, there have been no changes in the wholesale prices of ramen and bottled water so far. Nongshim and Ottogi, the top two ramen companies in Korea, have firmly stated that they have no plans to raise wholesale prices. Although ramen orders have increased due to the shortage, they say there are no supply issues yet. The daily shipment volume of Nongshim and Ottogi has increased by about 30% compared to usual.

Regarding this, a representative from a small mart said, "Some places are raising prices even though there is no supply disruption yet, which could be seen as a trick to release stockpiled products or to raise prices later." In fact, Wang Mart in Chungnam stated, "It is true that some marts have raised prices due to panic buying, but we will sell fairly (maintain prices)," they announced.

It is not only ramen and bottled water. There are many complaints about hand sanitizers being sold at excessively inflated prices. Mr. D said, "I went to a neighborhood supermarket and saw hand sanitizer that normally costs only 2,000 won being sold for 8,000 won, which I thought was outrageous."

If panic buying continues uncontrollably, large marts may impose sales restrictions and raise prices. At the end of 2016, during the severe egg supply shortage caused by avian influenza (AI), the three major large marts restricted sales and raised prices by an average of 10%. Currently, ramen sales at the three major marts, including E-Mart, are rapidly increasing. At E-Mart, sales of ramen, bottled water, and instant rice have increased by about 30% compared to the previous month.

The industry is closely monitoring how this situation will unfold. An industry official said, "There is a nationwide panic buying movement as sales of major daily necessities, including food, are increasing faster than usual," and emphasized, "If anxiety grows like this, opportunistic price hikes will continue, causing consumers to suffer."