"Kimchi Also Became Geumchi"... Rush of Chinese Kimchi Amid Soaring Cabbage Prices

Rising Ingredient Costs... Restaurants Seeking Chinese Kimchi
Imported Kimchi Imports Up 39% in May Compared to Previous Month
Domestic Kimchi Prices Expected to Keep Rising Due to Soaring Cabbage Prices

[Asia Economy Reporter Song Seung-yoon] "Even though all ingredient prices are rising, there's nothing we can do but accept it."

Kim Seong-ja (49, pseudonym), who runs a baekban (set meal) specialty restaurant in Geumcheon-gu, Seoul, recently switched the kimchi used as a side dish from domestic to Chinese origin after a year of using domestic kimchi since last year. This measure was taken to minimize cost burdens amid soaring food ingredient prices. Kim said, "I know customers don't prefer Chinese kimchi, but if we don't do this, we simply can't make any profit," adding, "Other restaurants that used domestic kimchi are gradually switching to Chinese kimchi as well."

Most imported kimchi is from China, and the price difference can be more than three times compared to domestic kimchi. As a result, kimchi imports are expected to gradually increase for some time. In March last year, the so-called 'Naked Kimchi' controversy led to a rise in preference for domestic kimchi and a movement to reject Chinese kimchi, but the atmosphere has changed in about a year.

According to the Korea Customs Service on the 6th, kimchi imports in May this year reached 24,845 tons, a 39% increase compared to the previous month (17,786 tons). Compared to the same month last year (21,148 tons), it also increased by more than 17%. Last month, kimchi imports recorded 13,852 tons by the 20th, an 18.7% increase compared to the same period last year. This trend is expected to continue for a while due to the rise in cabbage prices and overall ingredient costs.

Prices of domestic kimchi are expected to continue rising. According to statistics from the Korea Agro-Fisheries & Food Trade Corporation, as of the 4th, the wholesale price of 10 kg of cabbage averaged 12,600 KRW, more than 30% higher than a week earlier (9,650 KRW). It has risen more than 68% compared to a year ago (7,474 KRW). Due to poor harvests caused by drought, the upward trend in cabbage prices continues, and next month’s cabbage shipments are expected to decrease by 7.9% compared to the previous year, maintaining this trend. The area intended for autumn cabbage cultivation is also expected to decrease by 5.6% and 6.3% compared to the previous year and the average year, respectively. This is analyzed to be largely due to increased production costs and poor harvests last year.

Seasoning vegetables used in kimchi production are also all on the rise. The Agricultural Outlook Center of the Korea Rural Economic Institute forecasts that the wholesale price of garlic this month will be 8,500 KRW per kilogram for commercial-grade garlic, a 42.6% increase compared to the same month in an average year (5,961 KRW). Onion prices are also around 1,350 KRW per kilogram, 81.7% higher than the average month (743 KRW), and dried red pepper prices may rise if the quantity of fresh peppers harvested this month decreases due to drought.

Kimchi manufacturers are also cautiously watching the situation. CJ CheilJedang and Daesang already raised the prices of packaged kimchi by 5% and 7%, respectively, in February. However, with recent further increases in cabbage and vegetable prices, there are many factors pushing for additional price hikes.

An industry insider said, "If this situation continues, kimchi imports, which had slowed down for a while, are expected to return to previous levels," adding, "Many restaurants are already using Chinese kimchi, and more will switch to reduce ingredient cost burdens."

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