'World Hit Hard by COVID-19' Ate Korean Ice Cream at Home... Record High Exports

Record High Exports from Ramen to Ice Cream
Establishing the K Brand... Popular Items Like Melona and Seolleim

[Asia Economy Reporter Lee Seon-ae] This year, South Korea's ice cream export value is expected to reach an all-time high. Although the overall export of domestic industries has contracted due to the impact of the novel coronavirus disease (COVID-19), ice cream exports have been vibrant. This is attributed to the steady market entry efforts of domestic companies, which, combined with the effects of COVID-19, have led to a reevaluation of ice cream as a dessert snack, resulting in a sharp increase in sales volume.

Ice Cream Exports Approaching 60 Million USD

According to the Korea Customs Service on the 29th, ice cream export value from January to November reached 58.13 million USD, already surpassing last year's annual level of 54.18 million USD. Export volume was 17,450 tons, exceeding last year's annual level of 16,302 tons. Accordingly, a record high export value is anticipated this year.

By export destination country, the United States led, followed by China. Next were Canada, Vietnam, and the Philippines. First, 5,001 tons (14.859 million USD) were exported to the United States. Exports to China reached 2,539 tons (8.056 million USD).

Both domestically and internationally, due to movement restrictions caused by COVID-19, there has been an increase in consumption of snacks that can be easily enjoyed at home and a rise in overseas countries' preference for Korean ice cream. The Korea Customs Service analyzed, "Despite the difficulties posed by COVID-19, the global recognition of K-brands and efforts to diversify products tailored to local characteristics have contributed to the increase in frozen dessert exports."

Binggrae and Lotte Confectionery Achieve Export Success

Exports were led by the two major players in the frozen dessert industry, Binggrae and Lotte Confectionery. Binggrae is active in the U.S. market with its 'Melona' product. Binggrae's overseas ice cream sales have steadily increased from 21 billion KRW in 2017 to 25 billion KRW in 2018, and 33 billion KRW last year. This year, a sales growth of about 10% compared to the previous year is expected, making it likely to achieve 36 billion KRW in sales.

A Binggrae representative explained, "The main reason for the growth in ice cream exports is the influence of the U.S. market," adding, "Currently, half of the ice cream export volume is sold in North and South America. The driving force was securing sales channels by placing Melona in Costco, a large distribution channel with a nationwide chain network in the U.S. since 2016." Melona is now sold in all Costco stores across the United States. Additionally, last year, Binggrae established a local sales corporation in Vietnam and exports products such as 'Bungeoppang Samanco.'

Lotte Confectionery's major export products include Seolleim (China), Double Bianco (Russia), Screw Bar, Jaws Bar, and Watermelon Bar (Southeast Asia, North America), and World Cone (North America). Since early this year, they have strengthened their frozen dessert export organization and actively expanded new clients, resulting in sales growth of more than 50% compared to the previous year by November.

Domestic Market is Narrow, Focus Shifts Overseas

As growth in the domestic ice cream market slows, Binggrae and Lotte Confectionery are expected to continue focusing more on overseas markets. Domestic ice cream market sales are declining due to the spread of coffee shop beverages such as 'Iced Americano' and a decrease in the child population. According to the Korea Agro-Fisheries & Food Trade Corporation (aT) Food Industry Statistical Information, the domestic ice cream market size shrank from 19.564 trillion KRW in 2014 to 16.749 trillion KRW last year. It is projected to decline further to 16.608 trillion KRW in 2024.

Meanwhile, ramen export value is also expected to reach a record high of about 600 million USD this year, as ramen has gained attention as an emergency food due to COVID-19. Ramen export value through November this year was 549.72 million USD, a 28.4% increase compared to the same period last year. It has already surpassed last year's export value (467 million USD). By country, China accounted for the largest export value at 138.56 million USD, followed by the United States (72.84 million USD) and Japan (44.98 million USD). Annual ramen export value increased from 290 million USD in 2016 to 380 million USD in 2017, 410 million USD in 2018, and 470 million USD last year.