The Lunar New Year holiday in February and a slight easing of COVID-19 restrictions have boosted beef demand in South Korea.
Beef imports from Canada were 1,588 tonnes in January 2021, up 105.4 per cent from a year earlier and up 461.1 per cent from December 2020. A series of Canadian Beef in-market promotions in partnership with key local players are believed to have contributed to this growth.
Korea’s total beef import volumes were 63,787 tonnes in January, down 1.9 per cent from a year earlier, but up 106.3 per cent from the previous month. Imports from the U.S. were 30,736 tonnes, down 5.5 per cent from a year earlier, but up 96.8 per cent from the previous month. Imports from Australia were 26,820 tonnes, down 6.2 per cent from a year earlier, but up 115.1 per cent from the previous month.
Retail demand rebounds
After two months of tight social distancing guidelines, the South Korean government eased COVID-19 restrictions somewhat in the greater Seoul area on February 15. Before loosening restrictions, department stores, hypermarts and supermarkets had to close before 9 pm and couldn’t offer in-store sampling. However, as of February 15, they have been permitted to operate until their normal closing times and hold tasting events.
Overall beef sales in the retail sector are thought to have increased in February as consumers bought more expensive gifts, including beef, for the Lunar New Year’s Day, as the government asked people not to visit their family members.
To boost online sales many retailers are rushing to tap the emerging new trend of live commerce, which combines streaming and e-commerce.
Restaurants forced to innovate amid lost sales
Since mid-February, the government has allowed restaurants and cafes to operate until 10 pm, a one-hour extension from the two months prior.
The government, however, continued the ban on gatherings of five or more people. Small business owners welcomed the extension but it is estimated that restaurant sales, except very popular ones, declined around 70 per cent in February compared to the same month in 2020. Many restaurants have developed take-out or delivery menus and have also begun producing home meal replacement products.
Restaurants have also launched new products, dubbed “restaurant meal replacements,” made with famous restaurant recipes. The most popular products are soups and stews.
Importers and distributors affected by foodservice woes
Low demand for the foodservice sector has also hit many beef importers and distributors. Demand from the retail sector was higher in February than in previous months. The home meal replacement market (HMR) has grown rapidly in Korea, and many of the meals contain imported beef rather than the more expensive local Korean beef. As a result, demand from an increasing number of HMR product manufacturers is increasing greatly. Due to continued shipment delays from the U.S., wholesale prices for U.S. beef rose in February.