Best Product Prospects in the Korea Food Service Market for U.S. Exporters

A. Products Present in the Market Which Have Good Sales Potential

1. P ork meat (chilled and frozen belly cut): Due to the import ban on U.S. beef since December 2003, many beef restaurants have switched to pork menus, resulting in a strong demand for additional imports.   Although Korea has a large domestic supply of pork meat, local demand is highly skewed to the belly cut, which has resulted in a strong need for imports.   It is interesting to note that much of the meat is distributed frozen in the food service sector, as restaurants generally want longer shelf life.   During 2005 through November, total pork meat imports increased 79 percent from the previous year, to $537 million.   Imports from the United States during that same time period also showed an explosive growth of 269 percent to $120 million.  

2. Processed meats (sausages, hams): Due to easy application, a wide variety of local menus incorporate processed meat products.   Fast food, bars and buffet restaurants are the main users of these products.   Imports of sausages grew 39 percent in 2005 through November to $9.8 million (most of them from U.S.) while imports of preserved meat grew 118 percent to $42 million ($2.9 million from U.S.).

3 . Chicken meat (frozen and processed): Although there still remains some safety concerns among consumers over poultry products due to the on-going Avian Influenza issue, Korea remains an excellent market for chicken meat products .   In particular, the import ban on U.S. uncooked poultry products was lifted in 2005, resulting in a 588 percent increase of imports from the United States through November to $30 million, accounting for 37.6 percent of total poultry product imports.   Demand for further processed poultry products is expected to grow gradually in the future, as more restaurants understand the cost savings of value-added products.   Conversely, Korean food service sector is not a market for imported fresh chicken meat due to the short shelf life and strict sanitary standards (zero tolerance on E-coli contamination) on imported fresh meat.  

4 . Seafood (frozen and processed): Korea is an outstanding seafood market with good growth potential for imported products .   The domestic supply is decreasing due to the depletion of near sea fishery resources and increased international restrictions on deep-sea fishing.   Total imports of fishery products amounted to $2.1 billion in 200 5 (through November) , up 3.5 percent from the previous year, while i mports from the U nited S tates grew 10.5 percent to $ 130 million .   Major species currently imported from the United States include: Alaska Pollack, Pollack surimi, Pollack roes, tuna, skate, mackerel, hagfish, halibut, scallop , c od , Pacific salmon, angler fish, rock fish, and prepared sea cucumber.   It is notable that demand for processed products (fillet, dried, surimi, and cooked) are also rising.   Processed products (fillet, dried and salted) accounted for about 24 percent of total seafood imports in 2005.  

5 . Processed f ruits and nuts: Processed fruits and nuts are gaining consumer popularity for their natural and healthy image .   Introduction of new recipes that require processed fruit and nut ingredients is resulting in growing demand for more diverse products.   I mports of processed fruits and nuts from the United States amounted to $16 million in 2005 through November.   Products currently imported from the United States include: dried, frozen, or preserved prunes, cranberries, cherries, strawberries, grapes, figs, blueberries, walnuts, almonds, pistachios, pecans and peanuts.   Fruit juices also have a big market in Korea, as U.S. products, at $33 million imports in 2005, took a 35 percent import market share.

6. Fresh f ruits : Korea is an excellent market for U.S. oranges.   Demand for imported oranges is increasing in both food service and retail sectors.   Currently, U.S. , Australia and South Africa are allowed to export oranges to Korea.   Orange imports from the United States in 2005 through November amounted to $116 million.   Other U.S. fruits currently imported into Korea include table grapes ($7 million), lemons, cherries ($7 million) and grapefruits.

7 . Vegetables (fresh, frozen, canned and prepared): Although Korea is self-sufficient in many varieties of fresh vegetables, seasonal fluctuations in the local supply and unfavorable growing condition for foreign varieties are resulting in an increased demand for imports.   China has emerged as the leading supplier of vegetables to the Korean food service sector in both the fresh and processed category; however, there remains a solid demand for a limited variety of high-quality U.S. products.   Major products imported from the United States include potatoes, onions, lettuce, tomatoes, broccoli, avocadoes and carrots.   Imports of vegetables from the United States amounted to $21 million in 2005 through November, with an additional $49 million of imports of prepared vegetable products.

8 . Dairy Products (milk concentrate, cream, whey, butter and cheese): Diverse recipes with dairy ingredients are steadily being introduced, resulting in a growing demand.   In addition, there is an increased demand for imported dairy products from the thriving bakery industry.   Imports of milk concentrate and cream grew 80 percent in 2005 (through November) to $17 million (unfortunately, only $192,000 came from the United States).   Imports of whey grew 25 percent to $80 million, while U.S. products grew 105 percent to $21 million.   Imports of butter grew 49 percent to $12 million (only $65,000 from U.S.).   Imports of cheese amounted to $128 million, up 19 percent from the previous year, while imports from the United States also grew 28 percent to $23 million.  

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