Korean food companies are expanding their production capacity in Vietnam, considered a lucrative market due to growing consumer preference for Korean food (K-Food) products. The rising popularity of Korean food is also attributed to the country’s younger population willing to explore and try out overseas food products.
In June 2024, Daesang invested Won 30 billion (US$21.8 million) on expanding its plant in Vietnam with the aim of doubling its production capacity. Currently, Daesang has 4 factories in Vietnam focusing on convenience foods, RTE foods and sauces, maltose and tapioca starch, and processed fresh meat. Daesang saw its revenue doubled in Vietnam over a 5-year period to Won 201.6 billion (US$146.3 million) in 2023.
Another Korean firm, Paldo Corporation completed the construction of its 2nd instant noodle factory in Tay Ninh in southern Vietnam. Its first plant is located in the northern region, thereby enhancing connectivity and logistics to the whole of Vietnam.
Meanwhile, Ottogi is also planning for further expansion in Vietnam with its recent launch of ‘Oppa Ramen’ in the Vietnamese market. Ottogi presently has 2 factories in Bac Ninh and Binh Duong provinces.
Currently, the biggest Korean player in the Vietnamese food market is Orion which recorded sales of Won 475.5 billion (US$345 million) in 2023, and it is also expanding rapidly by constructing more factories in the country. Another major player is CJ CheilJedang which focuses on fresh and frozen food business. So far, it has invested Won 30 billion (US$21.8 million) to establish an integrated production plant in the Mekong Delta province of Long An in 2022, with plan to further allocate Won 100 billion (US$72.6 million) in additional facilities in 2025.
In more detail, Daesang Corporation has invested Won 30 billion (US$21.8 million) into 2 of its factories in Hai Duong and Hung Yen provinces.
It has increased its production capacity for the Hai Duong factory by 40% with an expanded dried seaweed line and a new ambient-ready meal manufacturing line.
Its factory in Hung Yen has more than doubled its annual capacity producing kimchi products and convenience foods such as spring rolls and steamed ‘banh bao’ pork buns, apart from existing processed meat. Daesang’s flagship product, Jongga Kimchi, will be produced by a new production line at the factory.
By increasing its domestic kimchi production, Daesang aims to expand its market share in Vietnam. In addition, the company also plans to secure a stronger presence in Vietnam’s ready-meal market with its O’Food brand. Daesang commands more than half of Vietnam’s seaweed market under its global food brand O’Food.
