Invest Korea

The Korean food market was worth USD 128.7 billion as of 2019, which was 1.9% of the global food market.
In response to the recent growth of emerging markets, such as China and ASEAN countries, and the growing
global demand for Korean processed foods, exports have been rapidly and continuously growing.

Based on high demand for Korean processed foods, centered on Southeast Asian and greater China markets, and the country’s geopolitical location, the Korean food industry has been continuously expanding while gradually making a transition from domestic-centered to an expansion of exports.

Active overseas expansion and increases exports, an export structure centered on high value-added products,
the expansion of free trade agreements, and active cooperation with foreign companies contributed to
strengthening the foundation for further growth.

The food industry is actively responding to demographic changes, such as an increase in single-person households,
and developing new products to meet diverse demands.
With the spread of non-face-to-face distribution channels in the wake of COVID-19,
home meal replacement (HMR) has established itself as a new growth engine in the food industry.

The Korean food industry (food & beverage) has continued to grow since the 1970s, thanks to economic growth and expansion of household consumption expenditures. As of 2019, the production scale of the Korean food industry was KRW 96.5 trillion. The industry has grown at an average annual rate of 5.9% since 2007, which is higher compared to the manufacturing industry (4.2%). The share of the food industry in the manufacturing industry has been steadily increasing. The number of businesses, production amount, and added value all increased compared to 2007.

Starbucks Korea is a joint venture between Starbucks and E-Mart (Starbucks 32.5%, E-Mart 67.5%). It is a defining success story among the countries where Starbucks has expanded to. After opening its first store near Ewha Womans University in 1999, Starbucks Korea had achieved more than KRW 1 trillion in sales by 2016, and sales and profit levels in 2018 increased by 20% and 24.8%, respectively, compared to 2017.

Nestlé Korea, since entering Korea as a joint venture in 1979, has been leading the food market trend by actively localizing globally popular products, such as Tasters' Choice, Nescafe, Coffee Mate, and Nesquik, to suit Korean tastes.

Nestlé provides customized products by identifying the tastes and characteristics of local consumers through field research and close cooperation with the R&D team at its headquarters. For active localization, Nestlé hires local employees and promotes customized marketing for the local market, and differentiated marketing for local holiday culture. The company actively collaborates with companies that have built strong distribution networks in Korea, such as Nongshim, Coca-Cola Korea, Doosan, and Namyang Dairy Products, to explore sales channels and secure distribution networks.

The Ministry of Agriculture, Food and Rural Affairs of the Republic of Korea has created an innovative ecosystem for the food industry through the 3rd Food Industry Promotion Basic Plan. Five policy areas and specific tasks were selected to promote a leap forward into the future industry. In order to preemptively nurture promising products, such as HMR, aging-friendly food, and functional food, and vitalize food industry clusters, the ministry will attract over 160 companies by 2022 and strengthen support for those companies, such as settlement and technical difficulties.

R&D based innovative food companies are selected for support, and additional technologies subject to tax reduction or exemption are discovered, with an aim to vitalize private R&D investment. The National Food Cluster Support Center is supporting resources necessary for early settlement of resident companies.

Foodpolis is a national food cluster created by the Ministry of Agriculture, Food and Rural Affairs, Jeollabuk-do, and Iksan. This core infrastructure for food industry promotion is located in Iksan, Jeollabuk-do.