Korean Food Company’s China Factory Started Operations on the 10th, but Operating Rate Remains Uncertain

[Asia Economy Reporter Lee Seon-ae] Most of the Chinese factories of domestic food companies, which had suspended operations for three weeks in response to the spread of the novel coronavirus infection (Wuhan pneumonia) and the Chinese government's decision to extend the Lunar New Year holiday, have begun to resume operations. However, it is expected to take some time for operating rates to return to normal due to the spread of the novel coronavirus.

According to the related industry on the 10th, Chinese production factories of CJ CheilJedang, Orion, Nongshim, and others started to resume operations one after another from this day. Factories that stopped operations on the 24th of last month, when the Lunar New Year holiday began, were originally scheduled to resume operations on the 3rd after the holiday. However, as the number of novel coronavirus patients increased, the Chinese government extended the holiday until the 9th, forcing a suspension of operations for three weeks.

CJ CheilJedang, which operates seven food factories in China, started operations from this day. Its 14 bio and feed factories are operating with utmost safety measures. A CJ CheilJedang official explained, "After consultations with the Chinese government, we resumed operations at seven food factories in China from this day, ensuring thorough safety and hygiene," adding, "Thus, all 21 food, bio, and feed factories (14 locations, which were never suspended even during the Lunar New Year holiday) in China are operating normally."

Nongshim's ramen factories located in Beijing and Shanghai resumed production from the 3rd, and its Yanbian bottled water factory resumed operations on this day. Since inventory was stocked up before the Lunar New Year holiday, there was no immediate disruption in sales, but the resumption of operations has eased some concerns.

Orion, which operates six factories in China, also resumed production while conducting infection checks and strengthening hygiene inspections for local employees returning after the holiday.

However, even after resuming operations, it will inevitably take time for operating rates to normalize. This is because the production and distribution systems, including raw material supply and logistics, are not running smoothly due to the spread of the novel coronavirus in China. Companies plan to respond by monitoring the infection status and other conditions rather than pushing to increase operating rates immediately.

An industry official said, "There are various distribution variables scattered throughout China, and if there are quarantined personnel, the limited workforce will make it take time for factory operating rates to normalize," adding, "If the novel coronavirus prolongs, the situation could recur, so we are keeping a tight grip on the situation, preparing for the worst-case scenario."

This content was produced with the assistance of AI translation services.