Thursday, 13 December 2018 09:55

The big cheese in South Korea

Written by 
Over 60% of South Korea’s cheddar imports now come from NZ. Over 60% of South Korea’s cheddar imports now come from NZ.

It's been three years since the free trade agreement (FTA) was signed with South Korea and New Zealand cheese is making a significant impact on their shelves.

The country is NZ’s fifth-largest cheese market, and in 2017 was worth NZ$120m a year.

NZ’s cheddar exports have more than doubled in value since the FTA was signed, and NZ now accounts for over 60% of South Korea’s cheddar imports.

While it’s good news for NZ, the FTA is also good news for our dairy farmers.  

Fonterra South Korea country manager Jason Murney says the access under the FTA allows Fonterra to invest in product and supply chain innovations and provide higher returns through its value-added products.

“We’re seeing some advancements in the Korea/NZ FTA so the future for cheese particularly is looking very good. This along with our investment in mozzarella cheese at Clandeboye in NZ and Stanhope in Australia, we’re expecting to see Fonterra’s cheese exports double over the next five years.

“Since the signing, Fonterra has seen a 40.5% increase in the value of our cheese trade with South Korea,” says Murney.

Consumption of dairy products is rising in Korea, as dietary trends follow those of neighbouring Asian countries such as Japan. In 1990 Koreans consumed 43.8kg liquid milk equivalent per capita but by 2017 that had risen to 79.5kg.

It’s expected that NZ’s annual duty-free quota of 7600 tonnes of cheese to Korea will increase by three per cent per year.

And it’s not all about cheese. Since the FTA was signed, butter imports have increased in value by 125%, with NZ accounting for about 40% of all South Korea’s butter imports.

“The development of the Korean market is in line with Fonterra’s strategy of moving more milk volumes into higher margin products, thus earning greater returns for our farmer shareholders,” says Murney.

 

More like this

US farmers don’t want a repeat run

With the US dairy industry now it in its fifth year of low prices and third year of trade wounds, president and CEO of the National Milk Producers Federation in the US, Jim Mulhern looks at what could come next.

EU protecting its patch

New Zealand cheesemakers fear that European proposals to protect names of many common foodstuffs may stifle local investment and innovation in cheesemaking, and limit choices for NZ consumers.

Trade talks on target - just

European Union and New Zealand trade officials are still hopeful that agreement on a free trade agreement (FTA) will be reached by the end of the year.

 
 

» The RNG Weather Report

» Latest Print Issues Online

Milking It

Budget blues

Now that the circus surrounding the Budget’s release has subsided, Milking It makes the following observations about some of its…

» Connect with Dairy News