Sector Trend Analysis – Bakery trends in South Korea

Trade overview

Global baked goods import in 2023 were US$52.9 billion. Top three countries that imported baked goods from the world in 2023 were the United States (US$10.6 billion), the United Kingdom (US$4.3 billion) and Germany (US$3.9 billion). Canada was the 6th largest country to import baked goods at the value of US$2.2 billion. South Korea ranked as the 26th largest importing country at the value of US$472.6 million. All the top 10 countries have positive growth ranging from 7.4% (France) to 14.5% (US) from 2019 to 2023.

Global baked goods export in 2023 was US$54.1 billion. Top three countries that exported baked goods to the world in 2023 were Germany (US$5.8 billion), Canada (US$5.2 billion) and Italy (US$4.1 billion). South Korea ranked 25th largest exporting country at the value of US$391.4 million. All the top 10 countries have positive growth ranging from 4.9% (US) to 18.1% (Mexico) from 2019 to 2023.

South Korea imported / exported bakery from / to the world including Canada

South Korea imported US$472.0 million baked goods from the world in 2023. The top three supplier were China (US$79.8 million), Malaysia (US$78.2 million) and the US (US$56.3 million). Viet-Nam grew the most at a CAGR of 41.7% from 2019 to 2023. Canada was the 15th largest supplying country to South Korea at the value of US$5.8 million in 2023.

South Korea exported US$391.0 million baked goods to the world in 2023. The top three countries were the US (US$123.8 million), China (US$53.1 million), Japan (US$23.3 million). Canada was the 4th largest importing country and grew the most by a CAGR of 25.0% from 2019 to 2023, importing US$22.0 million from South Korea.

Canadian provinces trade with South Korea

Total bake goods export to South Korea in 2023 was US$4.1 million. Ontario exported more than half of the goods at the value of US$2.4 million in 2023, followed by British Columbia at the value of US$1.1 million.

Total bake goods import from South Korea in 2023 was US$22.9 million. British Columbia imported more than half of the goods at the value of US$12.2 million in 2023, followed by Ontario at the value of US$10.1 million.

Retail environment and trends

Baked goods in South Korea

Baked goods retail sales in South Korea increased at a CAGR of 3.4% from 2018 to 2023, reaching US$3.8 billion. It will grow at a CAGR of 4.6% from 2023 to 2028, reaching US$4.8 billion in 2028. Frozen baked goods is the best performing category in 2023, with retail value sales increasing by CAGR of 32.4%. reaching US$56.1 million.

Prices of raw materials are continuously rising in South Korea due to recent inflation. However, as high inflation persists, local consumers are showing a discernible inclination towards baked goods with a reasonable balance between price and assured quality, rather than exhibiting overly price-sensitive reactions. This balanced consumer attitude has emerged as a prominent factor affecting their purchasing behaviour, resulting in packaged baked goods outperforming unpackaged options over the year Euromonitor 2023).

Baked goods volume grew by a CAGR of 0.1% from 2018 to 2023, reaching 392.9 thousand tonnes in 2023. It is estimated that it will increase by a CAGR of 2.4%, to attain 443.3 thousand tonnes in 2028.

The top three companies that achieved the largest retail sales of baked goods from 2018 to 2023 were SPC Group (US$455.7 million in 2023), followed by Orion Group (US$149.1 million in 2023) and Lotte Group (US$139.1 million in 2023). Of these top three companies, SPC Group grew positively a of 7.2%, Orion Group grew at 2.4% while Lottle Group declined in CAGR's by 6.6% in 2023.

In terms of brands, the largest brand Samlip and 4th largest brand Oh Yes demonstrated a positive growth from 2018 to 2023 with CAGR's of 7.2% and 0.5% separately, reaching US$455.7 million and US$41.1 million respectively in 2023.

Retail subsector analysis

Overall positive impact on packaged bread

Retail sales of packaged leavened bread increased by a CAGR of 13.0% from 2018 to 2023, reaching US$113.3 million in 2023. At the same time unpackaged leavened bread increased by a CAGR of 2.1%, to US$1,201.9 million. However it is estimated that the growth for both packaged leavened bread and unpackaged leavened bread increased by a CAGR of 6.5% and 4.3% separately from 2023 to 2028.

In terms of retail sales volume, the packaged leavened bread grew by a CAGR of 7.4% from 2018 to 2023, reaching 21.4 thousand tonnes in 2023. Conversely, unpackaged leavened bread decreased at a CAGR of −1.5% from 2018 to 2023, down to 160.0 thousand tonnes. It is projected that both packaged leavened bread and unpackaged leavened bread will all grow at a CAGR's of 4.2% and 2.0% respectively from 2023 to 2028.

SPC Group and Lotte Group were the largest bread companies in South Korea with retail sales attaining CAGR's of same 7.4% and 7.4% from 2018 to 2023 respectively, with both companies to increase retail sales to US$66.5 million and US$19.3 million respectively in 2023.

Samlip (SPC Group) and Lotte (Lotte Group) were the largest bread brands in South Korea with retail sales attaining CAGR's of 7.4% and 7.4% from 2018 to 2023 respectively, with both companies to increase retail sales to US$66.5 million and US$19.3 million respectively in 2023.

Both packaged cakes and unpacked cakes increased by a CAGR of 2.5% and 1.5% from 2018 to 2023 respectively. But both are predicted to grow by a CAGR of 2.8% and 4.3% respectively from 2023 to 2028.

In terms of volume, both packaged cakes increased at a CAGR of 0.2% and unpackaged cakes declined at a CAGR of −2.2% from 2018 to 2023. But both are predicted to grow at CAGR of 0.6% and 2.0% respectively from 2023 to 2028.

SPC Samlip Group experienced the largest growth by a CAGR of 9.0% from 2018 to 2023, followed by Private label & Orion group which grew by a CAGR of 2.5% and 2.4% separately from 2018 to 2023.

Samlip demonstrated a positive growth at an increase in CAGR of 9.0% from 2018 to 2023. However, the Onion and Lotte brands declined in growth at −1.2% and −10.8% respectively from 2018 to 2023.

In terms of retail sales value, dessert mixes grew negatively by a CAGR of −5.3% from 2018 to 2023, reaching US$6.7 million in 2023.

In terms of retail sales volume, dessert mixes also decreased by a CAGR of −6.5% from 2018 to 2023 reaching 0.5 thousand tonnes in 2023. It continued to drop by a CAGR of −4.4% from 2023 to 2028, down to 0.4 thousand tonnes in 2028

CJ Corp was the largest dessert mix company with retail sales valued at US$1.4 million in 2023, representing an decrease in CAGR of −9.5% from US$2.3 million in 2018. Samyang Holdings Corp also decreased by a CAGR of −14.6% from 2018 to 2023, down to US$1 million in 2023

Beksul (CJ Corp) was the largest dessert mix brand with retail sales valued at US$1.4 million in 2023, representing a decrease in CAGR of −9.5% from US$2.3 million in 2018. Qwon (Samyang Holdings Corp) also decreased by a CAGR of −14.6% from 2018 to 2023, down to US$1,0 million in 2023.

Retail sales of the frozen baked goods category increased by a CAGR of 32.4% from 2018 to 2023, reaching US$56.1 million in 2023. It continued to grow by a CAGR of 9.9% from 2018 to 2023, reaching US$89.8 million by 2028.

In terms of retail sales volume, frozen baked goods grew by a CAGR of 27.5% from 2018 to 2023, reaching 3.7 thousand tonnes in 2023. It continued to grow by a CAGR of 7.9% from 2018 to 2023, reaching 5.4 thousand tonnes by 2028.

The frozen baked goods company CJ Corp experienced the largest increase in CAGR of 60.1%, reaching US$4.6 million in 2023 from US$0.7 million in 2019.

The frozen baked goods brand Gourmet (CJ Corp) experienced the largest increase by a CAGR of 60.1%, reaching US$4.6 million in 2023 from US$0.7 million in 2019.

The packaged pastries category experienced the largest increase in a CAGR of 12.3% while unpackaged pastries by a CAGR of 3.1% from 2018 to 2023, reaching US$394.6 million and US$543.5 million respectively in 2023.

In terms of retail sales volume, packaged pastries grew by a CAGR of 8.9%, while the unpackaged pastries decreased by a CAGR of −1.0%, reaching 47.1 thousand tonnes and 57.5 thousand tonnes respectively in 2023.

SPC Group experienced an increase by a CAGR of 6.6% from 2018 to 2023 for retail sales of US$268.6 million. Lotte Group recorded US$27.1 million in retail sales in 2023 by a CAGR of −6.2% from 2018 to 2023.

Samlip (SPC Group) experienced an increase in CAGR of 6.6% from 2018 to 2023 at the retail sales of US$268.6 million. Lotte (Lotte Group) recorded US$27.1 million retail sales in 2023 at a CAGR of −6.2% from 2018 to 2023.

Distribution channel

The majority of South Korea's bakery products are distributed through store-based retailing versus non-store retailing during the historic period. Grocery retailers distribute most of the products in South Korea representing a market share of 96.1% while the remainder of the bakery products are distributed through non-grocery specialists (general merchandise store) at 3.9% in 2023. Retail offline represents a 97.2% of the total retail channel while non-store retailing (e-commerce) 2.8% in 2023.

Retail e-commerce experienced the largest increase in CAGR (25.0%) followed by convenience retail at 11.4% from 2018 to 2023.

Product launch analysis

According to Mintel's Global New Products Database (GNPD), 2,899 bakery products were launched in South Korea from 2019 to 2023. Top sub-categories of new bakery products included cakes, pastries & sweet goods with 1,433 launches, sweet biscuits/cookies with 705 launches, bread and bread products with 373 launches and baking ingredients and mixes with 219 launches. Flexible was the most common package type, with 2,308 launches, while flexible stand-up pouch followed with 190. New variety/range extension was the largest new launch type, with 1,312 launches, while new product was second with 1,133 launches and new packaging was third with 350 launches.

Examples of new product launches

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Resources

• Global Trade Tracker, 2024
• Euromonitor International, 2024
• Euromonitor International 2023, Baked Goods in South Korea
• Mintel Global New Products Database, 2024

Sector Trend Analysis – Bakery trends in South Korea
Global Analysis Report

Prepared by: Hongli Wang, Market Analyst

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