Milk powder market in South Korea

Earlier Report Observations

The South Korean milk powder market volume declined significantly from over 83,000 t in 2018 to approximately 53,000 t in 2023. This contraction was primarily driven by long-term demographic headwinds, including a low birth rate and an aging population, which reduced the size of the core youth consumer base. Concurrently, rising imports of cheaper sterilized milk, often priced at about half the cost of domestic liquid milk, intensified price competition and shifted some consumption away from locally produced dairy, affecting the powder segment.

The COVID-19 pandemic in 2019-2020 further depressed demand by leading to school closures and a sharp reduction in school milk programs. In response, major domestic processors like Seoul Milk launched premium products such as A2 milk, targeting older demographics to offset losses in traditional segments. The entry of a new player, Dongwon F&B, with its 'Hej' brand in 2022 added to the competitive landscape, while import volumes of sterilized milk continued to grow through 2023, exerting persistent downward pressure on domestic market share.

By 2023-2024, changing consumer preferences accelerated the growth of plant-based milk alternatives, while anticipated tariff eliminations on U.S. and EU sterilized milk under free trade agreements set the stage for increased import competition. These structural shifts, alongside sustained consumer price sensitivity, continued to challenge the local dairy industry and its milk powder production volumes.

Production milk powder in South Korea

In kind, 2017-2020, t

From 2017 to 2020, South Korea ranked as the 27th largest producer of milk powder globally.

Top producers of milk powder, 2017-2020

World map of production of milk powder, 2017-2020

In 2020, South Korea produced 42 300 tons of milk powder, marking a 14.8% increase from the previous year. The lowest production level was recorded in 2019 at 36 850 tons, while the highest was in 2018 at 53 539 tons. The most significant decline occurred in 2019, with a drop of 31.2%, whereas the largest increase was in 2018, rising by 28.4%.

Annual dynamics of production in South Korea in kind, 2017-2020, t

Exports milk powder from South Korea

Exports in kind, t

The market exhibited volatility during the observed period. Exports reached their minimum in 2020 at 110 tons, which was 71.5% lower than the previous year, and peaked in 2019 at 386 tons, resulting in a 3.5-fold difference between these years. The largest increase was recorded in 2019, surging by 185.1%.

Annual dynamics of product's exports from South Korea in kind, 2017-2020, t

Between 2017 and 2020, Japan, China, and Vietnam were the primary destinations for South Korea's milk powder exports in volume terms, accounting for 56.8%, 17.2%, and 10.0% of exports, respectively. Together, they represented 84.0% of total export flows.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from South Korea in kind, 2017-2020

Exports in value, K $ US

The data shows irregular changes, reflecting a volatile market environment. Exports peaked in 2019 at 1 735 thousand US dollars and fell to their lowest point in 2020 at 682 thousand US dollars, a swing of 2.5 times. In 2020, exports decreased dramatically by 60.7% compared to the prior year. The largest increase was recorded in 2019, rising by 139.1%.

Annual dynamics of product's exports from South Korea in value, 2017-2020, K $ US

From 2017 to 2020, Japan, Vietnam, and China were the top contributors to South Korea's milk powder exports in value terms, with shares of 32.2%, 31.4%, and 26.9%, respectively. Collectively, they accounted for 90.6% of total export value.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from South Korea in value, 2017-2020

Imports milk powder to South Korea

Imports in kind, t

South Korea's milk powder imports declined for the second consecutive year. In 2020, imports stood at 22 984 tons, a sharp drop of 20.7% from 2019. Over the period from 2017 to 2020, imports decreased by 17.4%, equivalent to an annualized rate of 6.2%. The highest import volume was recorded in 2018 at 30 058 tons, with the largest increase occurring in 2018 at 8.1%.

Annual dynamics of product's imports to South Korea in kind, 2017-2020, t

During 2017–2020, the United States, France, and Australia consistently served as the main sources for South Korea's milk powder imports in volume terms, with shares of 26.2%, 19.0%, and 18.2%, respectively. Together, they made up 63.3% of total import flows.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to South Korea in kind, 2017-2020

Imports in value, K $ US

After a two-year increase, South Korea's milk powder imports declined. In 2020, imports reached 70 178 thousand US dollars, down by 7.0% year-over-year. The maximum value was recorded in 2019 at 75 466 thousand US dollars, with the largest increase in 2019 at 8.5%.

Annual dynamics of product's imports to South Korea in value, 2017-2020, K $ US

Throughout 2017–2020, the United States, France, and New Zealand played leading roles in South Korea's milk powder imports in value terms, accounting for 23.4%, 19.7%, and 18.2% of imports, respectively. Combined, they represented 61.3% of total import value.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to South Korea in value, 2017-2020