The local Ministry of Agriculture, Food and Rural Affairs (MAFRA) piloted operations of a strawberry-only export flights to Singapore since December 2020, after the COVID-19 pandemic left the industry struggling to sell its produce or get it overseas.
The flights ran at a frequency of four times a week for five months, totalling 88 flights overall, and successfully managed to export some 960 tons of strawberries via this method, around 91% of total strawberry exports to Singapore.
“This tactic has also helped to increase the total strawberry exports to Singapore by 21% year-on-year despite the COVID-19 pandemic,’ said MAFRA via a formal statement.
“Local sales in Singapore have also been successful via intensive marketing initiatives – there was a lot of promotions done in high-end retail stories, and going the digital route using live broadcasting also saw the premium-priced strawberries sell out within three minutes.
“These were also popular with premium foodservice outlets such as dessert shops, restaurants and hotels – we saw 12 of these purchase the strawberries as ingredients for their dessert menus, laying the foundation for Korean strawberries to successfully enter the local premium market.”
Overall, the value of strawberry exports to Singapore increased from around US$12.5mn between December 2019 and April 2020 to around US$15.2mn between December 2020 and April 2021.
Banking on this successful pilot, the ministry now plans to expand its premium export market targets to include flights to more countries in Asia.
“In the future, we also look to secure the premium markets in major target markets such as Hong Kong, Thailand and Vietnam this way,” said the ministry.
“[Apart from export revenue], this is also a good way to increase local incomes [as] it eases the burden of transportation costs and expenses for both farmers and exporting firms.”
Local food prices high but dropping
One of the major reasons South Korea has been willing to invest in its premium exports is because these are not seeing much uptake locally, with consumers more preoccupied in getting everyday necessities at normal prices after severe weather conditions caused the prices of many foods to shoot up.
The nation has been suffering from a series of bad weather events, from monsoons and floods last year to a historic cold wave and heavy snow conditions this year, culminating in a shortage of various food items and pushing prices up.
“Eggs have been one of the most affected items locally, and the government is making efforts to substantially lower prices. Four big hypermarkets (Nonghyup, Homeplus, E-Mart and Lotte Mart) have already started to reduce prices since April,” said MAFRA.
“One of the ways we are bringing prices down is also to increase imports whilst also supplementing subsidies and coupons for local eggs.
“We are aware other staples such as rice have also been badly hit – a production decrease of 6.4% has led to a shortage of supply compared to demand, and so 210,000 tons of stockpiles have been released to the market to resolve the situation.”
The price of apples has also been on the rise, hitting a high of KRW34,302 (US$30.41) for 10 apples – or US$3.04 for one apple - and for this MAFRA admitted that the situation is likely to persist for some time.
“High prices for apples are expected to continue until this year’s fresh fruit harvest in August, because there was an 18.5% drop in overall apple production the last round – prices are currently some 55% higher than the average year,” it said.
As such, local demand for even more expensive fruits such as premium strawberries is unlikely to see a boost any time soon, and looking to new markets willing to pay a premium such as Hong Kong and Thailand are likely the best solution to selling the next round of strawberry harvests.