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South Korea’s exports of makgeolli to Japan

South Korea’s exports of makgeolli to Japan

SEOUL: South Korea’s exports of makgeolli, a traditional rice wine, to Japan have been in the doldrums since 2011 when they peaked at $48.4 million, government and industry data showed Monday.

Exports of makgeolli to the neighboring country rose sharply since the late 2000s thanks to the rising popularity there of Korean pop culture, called “hallyu,” and the strong value of the Japanese currency. Shipments rose over eightfold from $5.4 million in 2009 to $15.6 million in 2010 and $48.41 million in 2011, according to the data from the Korea Customs Service and local makgeolli exporters.

The heyday of makgeolli exports to Japan, however, was short-lived with the waning popularity of hallyu and the weakening yen. Hallyu has been cited as the main impetus of makgeolli’s popularity in Japan.

Exports dropped to $31.99 million in 2012, $13.62 million in 2013 and to $9.15 million in 2014. They further plummeted to $6 million in the first 11 months of last year, accounting for just 12.4 percent of the exports in the same period of 2011.

The sluggish exports of makgeolli to Japan were also attributed to a change in Japanese people’s drinking patterns. Many young Japanese and females, who led the makgeolli consumption in Japan, have turned to “highballs,” cocktails made of alcoholic liquor mixed with water or a carbonated beverage and served in a tall glass.

The dwindling exports to Japan, the largest importer of makgeolli, reduced South Korea’s total exports of the alcoholic product. In the first 11 months of 2015, Korea’s total makgeolli exports nosedived to $11.68 million, down 77 percent from $52.73 million in 2011. The share of exports to Japan dropped from 91.8 percent in 2011 to 51.4 percent last year.

The fall in exports to Japan also caused Korea’s makgeolli production to drop. According to Statistics Korea, local makgeolli production rose from 214,069 kiloliters in 2009 to 387,724 kl in 2010 and to 443,151 kl in 2011. But the output tumbled to 383,395 kl in 2012 and to 376,696 kl in 2014. The local makgeolli industry is now turning its eyes to markets other than Japan.

Exports to China, the second largest overseas makgeolli market following Japan, rose 44.9 percent from $1,272,000 to $1,843,000 in the same period. Exports to Hong Kong and Taiwan are also showing high growth of over ten times, although the amounts are not big at present. Exports to Hong Kong rose from $39,000 to $455,000 while those to Taiwan swelled from $16,000 to $167,000.

An industry source said the growth of the makgeolli market is high in such countries where rice is a key staple grain as Hong Kong, Taiwan and Singapore. Despite sluggish exports, Japan is still the largest makgeolli market, so it is difficult for the local makgeolli industry to give up.

Makgeolli makers are making efforts to create new demand in Japan by developing new products with lower alcohol degrees and adding various fruit fragrances. In hopes of creating a second makgeolli boom in Japan, the Ministry of Agriculture, Food and Rural Affairs is planning promotional events in Shinjuku, Tokyo, on a regular basis.

A ministry official said the ministry is discussing promotion plans with makgeolli exporters and is considering linking the promotion in Japan with the “makgeolli festival” slated for October in Korea.