Latest news from Korean Seaweed: Rising prices and improved government support.
A few days ago, there was a small news in our family business.
My father, who also deals in raw material of seaweed, noticed that the price of seaweed’s raw material doubled the day after he purchased them.
Seaweed, being primarily produced from November to February/March, so it is most valuable during autumn in Korea, particularly from September to October.
I recall the challenges we faced last October in meeting the budget and quality expectations of buyers want to purchase seaweed.
As of March 18, the wholesale price of 100 sheets of dried seaweed has risen to $7 to $8, almost doubling compared to a year ago.
Various factors contribute to this price increase, including reduced production due to global warming, but the main cause is the surge in exports of Korean seaweed products.
By 2023, Korea’s seaweed exports are expected to surpass KRW 1 trillion(770 million dollars), prompting the Ministry of Oceans and Fisheries(MOF) to introduce a “seaweed cultivation policy.”
Despite intense price competition domestically due to several B2C platforms, most seaweed is prioritized for export, resulting in a scarcity of seaweed for domestic consumption and subsequent price hikes.
Although the current raw material price may not immediately impact end-product prices, it is anticipated to significantly affect factories which don’t have *One-Stop Process.
(* One stop process: All processes from cultivation to processing are performed by one company)
Meanwhile, the government continues to emphasize export promotion policies, aiming to achieve $1 billion in seaweed exports by 2027, as outlined in the “1st Basic Plan for Promotion of Seaweed Industry.”
This basic plan established four implementation strategies as follows, with a final goal of $1 billion.
To this end, it consists of 12 detailed implementation tasks.
[1st Basic Plan for Promotion of Seaweed Industry]
- Supply of high quality raw materials
1) Develop seeds that are resistant to rising water temperatures
2) Expansion of eco-friendly certification support projects - Creation of high added value
1) Designation of ‘Seaweed Industry Promotion Zone’ created to promote seaweed production and export (Shinan, Haenam, Seocheon)
2) Establishment of a quality system - Future sustainable growth industry
1) Strengthening new product research and development (R&D)
2) Designation of a specialized organization - Creating international demand
1) Establishment of a customized export strategy platform for each major country
2) Expansion of the international certification system
3) Promotion of globalization of Korean seaweed “K-GIM” name
The prospects for Korea’s seaweed market look good as the government is taking action to increase exports, which were $650 million by 2022, to $1 billion.
However, as we need to balance exports and domestic demand, we will need to come up with a solution soon to adjust the price of seaweed.