1kg 103,000 KRW, up 6%
Demand surges with 200,000 KRW gift increase
Supply unchanged, prices likely to rise further
Distribution industry strives to secure stock
[Asia Economy Reporter Lim Hye-seon] As the Lunar New Year holiday (February 12) approaches, the price of Korean beef (Hanwoo) is on the rise again. The government raised the allowable gift value for agricultural and marine products from 100,000 won to 200,000 won, increasing demand, but supply remains unchanged, making it difficult to secure quantities. There are even forecasts that prices will continue to break record highs day by day.
According to the Livestock Products Quality Evaluation Service's livestock distribution information on the 19th, as of the 18th, the consumer price of Hanwoo sirloin (1kg) was 103,266 won, up 6% from 97,438 won on December 28.
Due to the spread of the novel coronavirus infection (COVID-19), demand for home-cooked meals increased, and with the emergency disaster relief fund paid in May, Hanwoo prices surpassed 100,000 won for the first time since related statistics began on June 3 last year (100,029 won). The price, which fluctuated around 100,000 won, fell to 97,411 won on August 31 but rose ahead of the Chuseok holiday, reaching a record high of 104,894 won on September 25. It then briefly dropped to 97,438 won on December 28 but is rising again ahead of the Lunar New Year holiday.
The rise in Hanwoo prices is attributed to increased demand for high-priced gifts instead of hometown visits due to the COVID-19 situation during the Lunar New Year peak season. Lotte Mart's reservation sales performance for 2021 Lunar New Year gift sets from December 24 to January 17 showed a 69.0% increase compared to the previous year. In particular, sales of Hanwoo gift sets priced between 100,000 and 200,000 won surged by 148.9% compared to the same period last year. Sales of Okdom (tilefish) and wine also increased by 64.3% and 112.4%, respectively. Lotte Department Store's pre-order amount for Lunar New Year gift sets increased by 29% compared to last year. Hyundai Department Store and Shinsegae Department Store also saw reservation amounts rise by 25% and 7.4%, respectively.
Furthermore, the distribution industry expects Hanwoo prices to rise further due to the relaxation of the Improper Solicitation and Graft Act (Kim Young-ran Act). The Anti-Corruption and Civil Rights Commission decided to temporarily raise the gift limit for agricultural, livestock, and marine products from the 19th of this month to February 14, following the same measure during last year's Chuseok holiday.
The distribution industry is making every effort to increase the quantity of high-priced gift sets by more than 30% and secure Hanwoo supply. Lotte Department Store expanded Hanwoo quantities by more than 30%, anticipating increased demand for premium Hanwoo in meat gift sets. The limited 100-set ‘Luxury Hanwoo Set’ priced at 1.7 million won is selling quickly despite its high price. Hyundai Department Store also prepared 30% more Hanwoo gift sets priced over 300,000 won. The quantity of ‘Hyundai Premium Hanwoo’ gift sets, priced over 1 million won, increased by 50% compared to last Lunar New Year.
A distribution industry official explained, "The reservation depletion trend is faster than in previous years, and there is fierce competition to secure additional quantities," adding, "Especially department stores are focusing on sales by offering the highest quality products to secure VIP customers."
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