[Report] "Catch Korean Customers"... Top Global Companies in LED and Pharmaceutical Equipment Also Send 'Love Calls'

[Visiting the Mecca of Industry and Commerce in China]
Top Lighting Manufacturer Zhongwei Produces Korean Promotional Videos Annually
Warehouse Filled with Equipment "All Bound for Korea"
Exports to the US Plummet... Growing Importance of Korea

"Excessive development of fossil energy is melting glaciers and causing global warming. In an era where happiness and a sense of crisis coexist, we will promote the continuous development of smart transportation and eco-friendly energy."

On the 24th of last month, in Ningxia County, Changsha, the capital of Hunan Province in southeastern China, a Korean-language video was being played loudly at the entrance of the PR center of a Chinese company headquartered there. On the right side of the screen, the Korean phrase "Outstanding technological leadership for the best materials" was clearly embossed. This company is Zhongwei (中偉·CNGR), which ranks first in the world in precursor shipment volume. According to a company official, they have been producing a new Korean-language promotional video every year since 2021 for their Korean clients.

Facing barriers such as limited domestic growth and the US-China hegemony competition, Chinese companies are sending love calls toward the Korean market. Despite the stagnant improvement in Korea-China relations, companies in Hunan Province have been actively working to expand their presence in the Korean market.

On the 24th of last month, I visited the Zhongwei headquarters showroom in Changsha, Hunan Province, China. The company's global market expansion status and major clients are displayed. The CI of a Korean client can be seen in the middle right. (Photo by Kim Hyunjung)

The entrance of the Zhongwei headquarters exhibition hall in Changsha, Hunan Province, China, visited on the 24th of last month. A company promotional video in Korean is being shown. (Photo by Kim Hyunjung)

Korea is Hunan Province's 3rd Largest Trading Partner... Seeking Opportunities Amid US-China Conflict

Korea holds a fairly solid position in Hunan Province, known as the mecca of Chinese commerce and industry. As of last year, the trade volume was $4.1967 billion (about 5.8048 trillion KRW), ranking third after the United States ($7.444 billion) and Malaysia ($5.2072 billion). This is a two-rank rise from fifth place in 2022.

Trade volume with the United States peaked in 2021 at $12.6306 billion but has decreased every year since, shrinking by 39.49% last year compared to the previous year. During the same period, Korea's trade volume also slightly decreased, but the decline (-2.48%) was relatively minor. In a situation where trade with the US is unfavorable, Korea, with its solid industrial base in high value-added electronic technology products such as semiconductor machinery and measurement inspection equipment, is the most attractive and promising trade partner for the Hunan provincial government and companies.

Zhongwei, which opened its production site to Korean media for the first time that day, also regards Korea as a key market. The company's sales, which were 7.44 billion yuan (about 1.4362 trillion KRW) in 2020, increased to 34.27 billion yuan last year and 20.09 billion yuan in the first half of this year. During this rapid growth, Korean companies such as LG Chem, Samsung SDI, SK On, POSCO, and Ecopro have become major clients. As of last year, exports to Korea accounted for 20.31% of total exports.

The Ningxia County plant in Changsha is a key base with an annual production capacity of 72,000 tons, accounting for 24% of China's total production (300,000 tons). In the case of cobalt tetroxide, more than 30,000 tons are produced annually, which is 100% of Zhongwei's production. The company invested more than 1.056 billion yuan in research and development (R&D) last year, nearly four times the 270 million yuan spent in 2020.

"All These Equipment Are for Korea... We Also Established a Service Center"

"The equipment piled up in front will all be exported to Korea next week via Shanghai and Incheon Port. This month alone, 32 containers will be shipped to Korea, which is less than 10% of our annual exports."

On the same day, at the headquarters of Chutian Keji (楚天科技·Trueking), the world's number one pharmaceutical equipment company, a massive warehouse was visited. This warehouse, one of the largest in Asia at 40,000 square meters, was piled high with equipment awaiting shipment to Korea. The main products are microbial culture system equipment, with Korean bio companies, now the largest buyers after India, as major clients.

Chutian Keji has sales and service centers (SSC) in 16 countries, including Korea, Southeast Asia, and Europe. In Korea, about 40 employees, including 20 dispatched from headquarters, work at the center located in Dongtan.

A company representative is explaining their product at the headquarters of Chutian Technology (Trueking), the world's number one pharmaceutical equipment company. (Photo by Kim Hyunjung)

The headquarters of Chutian Technology (Trueking), the world's number one pharmaceutical equipment company, features a massive warehouse. All the equipment in the photo is scheduled to be exported to Korea via Shanghai Port and Incheon Port. (Photo by Kim Hyunjung)

The company's main products include injection equipment for injectables, microbial incubators, and freeze dryers, which are bioengineering and integrated pharmaceutical equipment. The Korean companies importing this equipment number over 30, including SK Chemicals, Kwangdong Pharmaceutical, BioPlus, and PharmaResearch. A company official said, "We provide turnkey solutions tailored to the fields and methods desired by Korean companies, including design. Korea is a leading and rapidly growing market in the bio sector."

Li Shuze, Vice President of Chutian Keji, explained, "Exports to Korea have been increasing since 2020. Although our global market presence was weak, we began focusing on overseas business from 2021, accelerating our entry into Korea, and the sales proportion from Korea has clearly increased." He added, "Korea accounts for the 10% range of total exports excluding domestic and subsidiary sales, making it the second-largest export country after India."