South Korea's cosmetics trade surplus surpassed the 4 trillion won mark (US$3.58 billion) for the first time in 2017. Korea’s cosmetics exports to China increased despite the diplomatic dispute over Seoul's deployment of THAAD, a U.S. missile defense system, while those to Vietnam and Indonesia nearly doubled from a year earlier. However, the nation’s cosmetics production recorded a single digit growth for the first time in five years.
According to the Ministry of Food and Drug Safety on July 5, the trade surplus of South Korea-made beauty products came to 4.26 trillion won (US$3.81 billion) last year, up 18.5 percent from 3.6 trillion won (US$3.21 billion) tallied in 2016. It was the sixth consecutive year for the country's cosmetics exports to have exceeded their imports since 2012.
Last year’s cosmetics production totaled 13.52 trillion won (US$12.08 billion), up 3.6 percent from 13.05 trillion won (US$11.66 billion) in 2016. By type, skincare products took up the most of production at 7.62 trillion won (US$6.81 billion), followed by makeup products at 2.14 trillion won (US$1.91 billion), hair products at 1.53 trillion won (US$1.37 billion) and bath and body products at 1.26 trillion won (US$1.13 billion).
However, the production growth rate in 2017 was at an all-time low in the past five years. The on-year growth rate was 11.92 percent in 2013, 12.52 percent in 2014, 19.65 percent in 2015 and 21.6 percent in 2016.
In terms of sales and market share, Amorepacific Corp. ranked first with 4.09 trillion won (US$3.65 billion), or a 30.26 percent market share, followed by LG Household & Health Care Ltd. with 3.97 trillion won (US$3.55 billion), or 29.35 percent, Aekyung Co. with 399.8 billion won (US$357.28 million), or 2.96 percent, Innisfree Corp. with 190.5 billion won (US$170.24 million), or 1.41 percent, and Coreana Cosmetics Co. with 172.4 billion won (US$154.07 million), or 1.28 percent.
South Korea's cosmetics exports came to 5.59 trillion won (US$5 billion) last year, up 18.3 percent from 4.85 trillion won (US$4.33 billion) in 2016. Its outbound shipments' average growth rate in the last five years also stood at 36.8 percent.
The strong demand in China boosted the growth of the nation’s cosmetics exports. China was the largest importer of South Korean cosmetics items last year, despite the THAAD issue, which led to a Chinese boycott of Korean companies. Outbound shipments of beauty products to China grew 23.1 percent on-year to 2.18 trillion won (US$1.95 billion) in 2017, followed by Hong Kong with 1.38 trillion won (US$1.24 billion), the U.S. with 503.6 billion won (US$450.04 million) and Japan with 254.8 billion won (US$227.7 million).
For Southeast Asia, in particular, exports to Vietnam and Indonesia jumped 96.8 percent and 60.8 percent on-year in 2017, respectively.
New additions to the top 20 importers of South Korean cosmetics were Germany, Poland in Europe and the United Arab Emirates in the Middle East, which is growing more and more interested in beauty care.