SEOUL • Don't count your chickens before they hatch.
Global poultry producers hoping to cash in on South Korea's craze for fried chicken and beer face a market crowded with local birds that have clipped prices and profits for Korean growers.
The popularity of the combination, known as "chimaek", has grown in recent years, fuelled by its appearance in a hit South Korean television drama and an explosion of restaurant chains.
Chimaek stores now dot South Korea and their ubiquitous delivery services shuttle freshly fried chicken and beer to homes, offices and even picnics. The craze has pushed local chicken producers into an increasingly tough battle for market share, prompting an oversupply and a drop in farm prices.
Now, imports are set to rise as South Korea lifts a ban on overseas suppliers who are attracted by still low per capita consumption rates.
South Koreans ate 14.2kg of poultry meat each last year, a near threefold increase since 1990, according to data from the Organisation for Economic Cooperation and Development, but only half the global average of 28.6kg per person.
Chimaek stores now dot South Korea and their ubiquitous delivery services shuttle freshly fried chicken and beer to homes, offices and even picnics. The craze has pitted local chicken producers in an increasingly tough battle for market share, prompting an over-supply and a drop in farm prices.
South Korea's market for chicken is expected to grow 5 per cent to 1.01 million tonnes this year and a further 3 per cent in 2017, according to the US Department of Agriculture, boosted by the chimaek craze. Analysts said the increase in chicken imports could squeeze domestic producers with lower prices. US suppliers might also find conditions challenging.
"It's going to be a tougher market because the US only had to compete against Brazil before. But now there are more competitors like Denmark and, sooner or later, Thailand," said Mr Jenis Bae, manager at KTSC, which has imported US poultry for almost 20 years.
Still, the competition is good for consumers and restaurants drawn to the chimaek boom.
Even global giant KFC recently opened its first "KFC Chimaek" outlets in South Korea, offering set menus such as two pieces of fried chicken, cheese fries and a glass of draft beer for 7,500 won (S$9.20).
Major Korean franchises are now expanding their overseas stores, particularly in China where the TV show My Love From The Stars is wildly popular and its heroine's chimaek cravings strike a chord with viewers.
Genesis BBQ, South Korea's top fried chicken franchise, now has 350 stores abroad in 30 countries.
"Our aim is to have more stores globally than McDonald's," said company director Kwak Sung Kwon.