Wine consumption in South Korea is set to reach record levels this year, as consumers learn of the grape beverage's health benefits, suggests a new report.
Imports of wine are expected to reach US$80 million in 2006, well ahead of last year's record US$68 million, according to data gathered by the US agricultural attaché in the country.
Imports for the first half of 2006 have already increased by 22.4 per cent, following a 17.2 per cent growth in 2005.
Wine is still consumed by a very small population, mainly in urban areas of South Korea, and comprises less than 2 per cent of total alcoholic beverage sales in Korea. But Korea is known to be an avid consumer of health foods, particularly the innovative functional beverages that are impacting more mature soft drink categories.
The wine market is therefore getting many new drinkers from the younger generation and the female population, although the interest in wine's health benefits mean that consumers' tastes are heavily skewed to red wine, which has over 79 per cent of the market, according to the report.
There is little competition from local products so importers are doing well out of this growing trend, particularly wines from the United States. Imports are up 46.7 per cent during the first six months, thanks largely to the depreciation of the US dollar against Korean currency.
The stronger interest in American wines could also be a result of "the future opportunities that may arise through a possible free trade agreement between South Korea and the United States", the report concludes.
France remains the biggest exporter of wine to Korea with a 33.7 per cent market share by value in the first half of 2006, although its share has been on a continuous decline as a result of the steep appreciation of the Euro against the U.S. Dollar during the last three years.
Chilean exports have also risen rapidly, thanks to a free trade agreement signed in 2003, which pushed the US out of the number two position.
But the US report says it is likely that the United States will narrow the gap though the rest of the year as annual exports of American wines to Korea will reach $10 million for the first time in history.