South Korea imports kimchi from China

At the end of last year, South Korea’s “winter kimchi” application was successful, but South Korea still realized that Chinese kimchi has become a strong competitor. In response to the competition, the South Korean government has made great efforts to increase investment and improve formulas, and strive to make the “National Treasure” kimchi red like the uncle of the world. However, Koreans are proud of the success of the application, but the trade figures reveal different stories: South Korea is actually a net importer of kimchi.

Hugo.com learned from the recent report of the Korean media “Asian Economy” that the trade income of Korean kimchi reached a deficit of 28.15 million U.S. dollars last year, which is a full increase of 565% compared with the 4.23 million U.S. dollars in 2012. China’s imports of cheap kimchi are increasing year by year and the biggest export market for kimchi is the main reason for the sharp increase in the Korean kimchi trade balance deficit.

Some experts pointed out that the profit of Korean kimchi export enterprises has deteriorated due to the appreciation of the yen, which has a negative impact on Japanese kimchi exports. As of last year, South Korea’s kimchi exports have reached 60 countries, an increase of 6 countries compared with 2010. The dependence on the Japanese market also fell from 84.2% in 2010 to 73.8% last year, showing a decreasing trend every year. The export of kimchi to the Netherlands and the United States increased by 37.1% and 27.7%, respectively, which indicates that South Korea is actively expanding overseas markets. However, from the current point of view, Korean kimchi is still highly dependent on Japan.

It is reported that the current kimchi has begun to appear in some high-end restaurants in London. The reason why kimchi is on the international stage is partly that the Korean culture is getting stronger and stronger, and the government has been working hard to promote Korean cuisine overseas. Previously, the successful application of Korean “winter kimchi” may make South Korea more confident, but considering the modern international taste, the original formula is still regarded as too spicy and too heavy.

The South Korean government said it will invest nearly 9 million US dollars to study Korean traditional food, kimchi bears the brunt. In addition, the government has allocated $34 million to improve production equipment.

However, although Koreans use “kimchi” as a national treasure, the data show that in 2012, the total import of kimchi was almost eight times that of exports, and the vast majority of imported kimchi came from China. Chinese-made kimchi costs less, but there are not many Koreans who know that they are eating Chinese kimchi. Because Chinese kimchi does not enter the supermarket, most Chinese kimchi enters the food service industry, and customers are invisible. The South Korean government is worried that China’s influence as a kimchi production country is increasing. It is decided to step up the management of restaurants this year, requiring restaurants to list the origin of raw materials, and customers should eat and understand. However, the South Korean government is increasingly investing in promoting Chinese cuisine overseas, and Koreans are eating less and less kimchi. The Korean government has also noticed and hopes to reverse this trend. The competition of overseas manufacturers is fierce, and domestic sales have been declining year after year. A famous Korean politician described that kimchi is “experiencing the same test as South Korea’s severe winter.”

Hugo.com understands that the trade balance of kimchi is rapidly deteriorating. The trade deficit of kimchi in 2013 was 28.15 million U.S. dollars, which was more than 6 times of the 2012 deficit. The decline in exports to Japan, which accounts for 70% of all exports, is the factor behind it. The analysis of Korea’s World Kimchi Research Institute, which is responsible for this statistic, is due to factors such as the appreciation of the Korean won and the deterioration of Japan-Korea relations. At the same time, imports of cheap kimchi from China are increasing. South Korea’s exports to Japan, including kimchi, fell by 10% in 2013. Many businessmen hope that the main reason is the exchange rate issue.

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