"Soju Prices Increased" Chamisul Up 7.9%... Will Restaurant Soju Reach 5000 Won? (Summary)

HiteJinro to Raise Prices of Soju Products Including Chamisul and Jinro on 23rd
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[Asia Economy Reporter Koo Eun-mo] Hite Jinro has decided to raise the factory shipment prices of soju products for the first time in about three years due to increased raw material costs, sparking expectations that other soju companies will follow suit with price hikes. Some voices express concerns that the price of soju sold in restaurants may rise significantly.

Hite Jinro announced on the 18th that it will increase the factory shipment prices of ‘Chamisul Fresh’ and ‘Chamisul Original’ by 7.9% starting from the 23rd. The price increase applies to 360ml bottles and some PET containers.

‘Jinro’ will raise its shipment price for the first time since its launch in 2019. It will increase by the same rate of 7.9% as Chamisul. Even after the increase, Jinro will maintain a lower price than Chamisul. However, ‘Ilpum Jinro’ was excluded from this price hike to promote the premium soju market.

A Hite Jinro official explained, “Recently, costs have risen sharply across the board, including raw material prices, logistics costs, bottle handling fees, and manufacturing expenses. We have been trying to absorb the increase through internal cost reduction and efficiency improvements. Over the past three years, price increase factors exceeding 14% have occurred and persisted, but after thorough review, we decided on the increase rate to minimize the burden on consumers.”

Recently, the rise in the price of ethanol and bottle caps had a decisive impact on the soju price increase. Earlier, Daehan Ethanol Sales raised the price of ethanol by an average of 7.8% starting from the 4th. This was the first price increase in 10 years since 2012. Daehan Ethanol Sales, which sells ethanol to soju companies, is a dedicated sales company established with equity participation from 10 domestic ethanol manufacturers including Jinro Fermentation. Taxed ethanol rose from 363,743 KRW to 391,527 KRW per drum (200L), a 7.6% increase. For untaxed and duty-free ethanol, the price rose from 351,203 KRW to 378,987 KRW, a 7.9% increase.

The price of bottle caps also increased. Bottle cap manufacturers such as Samhwa Crown and Sewang Metal Industry raised the price of soju bottle caps by an average of 16% starting from the 1st. Additionally, the deposit and handling fees for empty containers have also increased, creating significant manufacturing cost burdens for companies.

As Hite Jinro, the number one soju company, raises shipment prices, it is expected that other soju companies such as Lotte Chilsung Beverage, Muhak, and Bohae Brewery will inevitably follow with a chain of price increases. However, the industry is still cautious about discussing the price hikes. A Lotte Chilsung Beverage official said, “There are factors for price increases due to raw material cost hikes such as ethanol price increases, and we are reviewing them, but nothing has been finalized yet.”

Meanwhile, if soju companies raise shipment prices, it is expected that the price of soju sold in restaurants will jump from the current 4,000 KRW to around 5,000 to 6,000 KRW. In the case of beer, prices were first raised to 5,000 KRW in 2019.