Korea looks to China for high-end seafood sales, aquaculture investment
Korea is courting high-end buyers in mainland China with processed, branded seafood products — even as it draws increasing investment from Chinese aquaculture players to its shores. Major Korean seafood players like Hansung Enterprise Co. and Jeong Hwa Foods Co. are very eager to tap demand in China, explains Myung Han (Daniel) Kim, assistant manager of the Korea Fishery Trade Association. Sea cucumber, abalone, squid and flounder are all shipped from Korea to China, with Korean catches of South American squid also shipped to the country.
Korea benefits from plentiful sea access, Kim told Seafoodsource — but is struggling with a “flat” wild catch, particularly in the Yellow Sea. That has prompted government to promote the expansion of aquaculture. Plentiful and comparatively cleaner coastline has also drawn Chinese investment, in the form of Dalian-based shellfish producer, the Zhangzidao Group. “We have clean water and access to three seas, government is also very supportive of the growth of aquaculture,” said Kim.
Korea is China’s fourth-ranked supplier of imported plaice (Kim uses the term ‘flounder’) and mollusks (North Korea ranks first in mollusks) according to Chinese customs data for 2012. Quality and a high-tech approach to aquaculture are the main advantages of Korea over Chinese and other competitors, according to Kim.
“We have always focused on value-add. The Korean product is superior in taste and presentation too.” Jeong Hwa has focused on seasoned, cooked squid for the convenience retail market while Hansung — which operates factory vessels for pollock, tuna and squid in international waters — is keen to drive sales of canned tuna and other convenience-oriented foods in China.
As for abalone and sea cucumber, Korean imports compete favorably with domestic product on price in China, said Kim. Prices are similar to those charged in Dalian though product from the southerly province of Fujian is cheaper than Korean imports, he added.
Despite competition from China, Korea has held onto a seafood re-export business, processing raw material from Vietnam and the Philippines for re-export to the U.S. and Europe. Myung is hoping the firm can also build market share in China. “We’ll target VIPs and opinion leaders and get them to embrace Korean seafood products,” said Kim. China is Korea’s third largest market, after Japan and the U.S., for seafood exports. There’s also a strong trade in seaweed and squid to fourth-placed New Zealand. U.S. demand for flounder remains solid, he added.
Back home, seafood consumption is increasing as Korean consumers have been switching from eating red meat to eating seafood, said Kim. Korea remains a significant influencer of fashion and trends in its larger neighbor, with major Korean corporations like Lotte operating supermarkets and fast food outlets here. Major east coast cities like Dalian, Qingdao and also Beijing have large populations of Korean expatriates, many of them overseeing factories that were migrated to China in pursuit of lower costs.