Many advantages but Vietnamese bananas still only account for 1.9% of market share in South Korea

Bananas are mostly imported to Korea due to unfavourable farming conditions. Source: Internet

According to the Korea International Trade Association (KITA), in the first five months of 2021, South Korea imported bananas (HS code 0803) reaching 155.3 thousand tonnes, worth US$131.5 million, an increase of 3.4% in volume and 8% in value from the same period in 2020. The average price of imported bananas (HS code 0803) reached US$846.3/tonne, up 4.5% over the same period in 2020.

Banana is a popular fruit in South Korea, but the country has to import almost all its bananas due to poor farming conditions.

Vietnam was the sixth-largest banana supply market for South Korea in the first five months of 2021, reaching 2.9 thousand tonnes, worth US$2.3 million, up 13.6% in volume, up 48.3% in value from the same period in 2020. The average price of imported bananas from Vietnam was low, reaching US$791.6/tonne. The proportion of imports from Vietnam accounted for 1.9% of the total banana imports of South Korea.

According to the Import-Export Department (Ministry of Industry and Trade), Vietnam has many advantages to increase its market share in the Korean market due to the low import tariffs in the Vietnam - Korea Free Trade Agreement (VKFTA).

However, Vietnamese bananas have to compete with Philippine bananas - the largest banana supply market for South Korea.

To increase the market share of bananas in the country, the Import-Export Department said it must comply with the regulations on the new Korean pesticide list system (abbreviated as PLS), applied from 2019. This system regulates plant protection substances allowed to be used and maximum residue levels on imported fruits and vegetables.

“Bananas have a short-term advantage in price, but in the long run, they need to maintain high-quality products and need a large-scale production management system to improve price competitiveness and product quality,” a representative of the Import-Export Department said.