Customers browse packaged chicken at a supermarket in Seoul on June 21.YONHAP
The impact of the Iran war is reaching Korean dining tables. Food and beverage companies are raising prices as a prolonged period of high exchange rates and elevated oil prices drives up the cost of raw materials and other inputs, leaving manufacturers little choice but to pass the higher costs on to consumers.
Lotte Chilsung Beverage raised wholesale prices for 44 products across 12 beverage brands by an average of 5.5 percent starting Friday. Major products affected include Chilsung Cider, up about 4.3 percent, Milkis, up about 6 percent and Let's Be coffee, up about 7.6 percent. Pepsi, Mountain Dew and Gatorade products manufactured and sold by Lotte Chilsung under license from PepsiCo are also included in the price hike.
The latest move marks the company's first price hike since June 2024. Lotte Chilsung cited higher packaging and raw material costs, the weak won against the U.S. dollar and rising logistics expenses as the main reasons.
"Raw material prices have begun to stabilize following the ceasefire agreement between the United States and Iran, but the sharp rise in production costs earlier this year has been reflected in this latest price increase with a time lag," a Lotte Chilsung representative said.
One of the biggest cost pressures has come from naphtha, the feedstock used to produce plastic polyethylene terephthalate bottles. According to the Ministry of Trade, Industry and Resources' raw materials price information system, naphtha prices reached $1,018 per metric ton in March, up 59.6 percent from $638 per metric ton a year earlier.
Harim will also raise wholesale prices for 26 convenience store products, including chicken breast and fish cake bars, by 100 won to 300 won (7 cents to 20 cents) starting next month. The company attributed the increase largely to higher import costs for feed grain due to a weaker won.
The company is also discussing different price adjustments for various retail channels, including hypermarkets and online shopping platforms.
"The weaker won has pushed up the cost of feed grain as well as packaging materials and other production inputs, making a price increase unavoidable," a Harim spokesperson said.
Lotte Chilsung Beverage products are displayed inside a supermarket in Seoul on June 23.NEWS1
Ready-to-eat meals and popular snack foods such as tteokbokki (spicy rice cake stew) are also becoming more expensive. Ourhome, the food subsidiary of Hanwha Group, announced on its website on Tuesday that it will raise prices for some products in its frozen meal brand "OntheGo" by about 7.7 percent starting July 1.
As a result, the price of 12 ready-to-eat meals, including the Chuncheon-style cheese dakgalbi (spicy stir-fried chicken) rice bowl, will increase from 6,480 won to 6,980 won.
Hot Seasoner, which operates the tteokbokki franchise Dongdaemun Yupdduk, will also raise prices for the first time in 17 years. Prices will increase by about 7 percent across the menu, including its signature Yupdduk dish, from 14,000 won to 15,000 won. However, the company said the higher prices will not take effect until July 1 next year, after a one-year grace period.
The upward trend in food prices is expected to continue through the second half of the year as the food and beverage industry's second-quarter earnings are forecast to remain weak.
"Rising logistics and raw material costs caused by the weak won and the war are leading to higher food prices, increasing the burden consumers feel from inflation," said Lee Hong-joo, a professor of consumer economics at Sookmyung Women's University.
"If stagflation persists for an extended period, consumer spending will decline and create a vicious cycle. Companies, therefore, also need to make efforts to keep price increases to a minimum."
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
