Cosmetics Production Hits All-Time High Last Year... Exports Surpass $10 Billion, Ranking 3rd Globally

Cosmetics Exports Surpass $10 Billion Last Year
Domestic Production Up 21% to 17 Trillion Won
Record-High Exports for January to April This Year
Number of Responsible Sales Companies Down by 3,600

Last year, South Korea's cosmetics exports surpassed a record high of $10 billion, making the country the third largest player in the global market. The number of companies producing more than 100 billion won worth of cosmetics annually also increased from 12 in 2023 to 21 in 2024.

According to the Ministry of Food and Drug Safety on May 27, 2024, domestic cosmetics production reached 17.5426 trillion won, up 20.9% from the previous year's 14.5102 trillion won. Exports totaled $10.2 billion, a 20.3% increase year-on-year. Both production and export figures marked all-time highs.

Last year's export performance ranked South Korea third in the world, following France ($23.25823 billion) and the United States ($11.19858 billion). South Korea outpaced Germany, which was third the previous year with $9.07601 billion, by more than $1 billion.

South Korean cosmetics were exported to 172 countries, up by seven from the previous year. By country, China was the largest export destination at $2.49 billion, although this represented a 10.3% decrease from the previous year. The United States saw a sharp 56.4% increase to $1.9 billion, ranking second, followed by Japan ($1.04 billion), Hong Kong ($580 million), and Vietnam ($530 million).

A cosmetics store located in a large supermarket in Seoul.

Exports of basic and color cosmetics drove significant growth in new markets such as the United Arab Emirates (UAE), which ranked ninth with $170 million and a 91.0% increase. Indonesia ($140 million, 13th) and Poland ($130 million, 14th) also saw surges of 69.9% and 161.9%, respectively.

Cosmetics imports last year rose 0.8% from the previous year to $1.3 billion (1.8062 trillion won), resulting in a record trade surplus of $8.9 billion.

From January to April 2024, cosmetics exports reached $3.6 billion, up 15.5% from the same period last year, marking the highest performance ever for the first four months of the year. Last month's exports totaled $1.03 billion, the second time since October 2023 that monthly exports exceeded $1 billion.

In 2023, domestic production of basic cosmetics reached 10.2961 trillion won, up 58.7%. Color cosmetics (2.6755 trillion won, up 15.3%), personal cleansing products (2.077 trillion won, up 11.8%), and hair care products (1.528 trillion won, up 8.7%) also increased across most categories. The increase in exports of basic and color cosmetics appears to have driven the rise in production.

Among basic cosmetics, the production value of lotions and creams, as well as essences and oils, rose from 4.4405 trillion won in 2023 to 5.7515 trillion won last year. The production of packs and masks increased from 986.8 billion won to 1.3169 trillion won over the same period. For color cosmetics, lipstick and lip gloss production rose from 654 billion won in 2023 to 990.4 billion won last year.

In the functional cosmetics category, products that help improve wrinkles saw production surge by 71.0% to 2.5593 trillion won. This was analyzed as a reflection of the recent consumer trend of "slow aging," which focuses on slowing the aging process naturally and healthily.

The number of responsible sales companies, which can outsource production with just an idea and without manufacturing facilities, decreased by 3,592 to 27,932 from 31,524 the previous year. In July 2023, with the revision of the Cosmetics Act Enforcement Rules allowing for the administrative cancellation of responsible sales licenses, the Ministry of Food and Drug Safety revoked the licenses of 6,292 companies that had reported business closure to the tax office.

Of the 13,976 companies that reported cosmetics production results, 21 produced over 100 billion won worth of products, an increase of nine from the previous year's 12. Among these, eight companies more than doubled their production compared to the previous year. The total number of employees at the 13,976 responsible sales companies that reported production was 114,237, but 12,266 of these companies had fewer than 10 employees, accounting for 88% of the total, indicating that most are small businesses.