Pandemic boosts Nongshim, Ottogi, Samyang Foods in US

Nongshim's instant noodle products / Courtesy of Nongshim

By Kim Jae-heun

Korean instant noodle companies are seeing a “sharp increase” in sales in the United States due to the spread of COVID-19, which has forced many people to stay at home and seen them increase their consumption of such products.

The country's three major manufacturers ― Nongshim, Ottogi and Samyang Foods ― said Tuesday the volume of instant noodle exports to the United States rose sharply in the second quarter.

Nongshim's revenue in the U.S. in the first half of the year reached $164 million, up 35 percent year-on-year. The country's biggest instant noodle producer said the growth was thanks to soaring demand for its products at major retailers, there, including Costco, Kroger and Sam's Club.

Samyang Foods is said to have reported a substantial sales increase. While the company declined to comment on the specifics of its overseas performance, market analysts expect it to have generated 156.2 billion won in sales and a 25.8 billion won operating profit for the three months ending in June, up by 16.8 percent and 23.8 percent, respectively, year-on-year. Samyang has a negligible market share in the domestic instant noodle market as overseas shipments account for half of its sales.

Ottogi is expected to report a strong performance in the second half as the pandemic has seen its overseas sales boosted. Revenue and operating profit are forecast seen to increase by 5.3 percent and 9.5 percent, respectively, analysts said. Net profit in the second half is also expected to soar by 32.3 percent to 32.8 billion won.

According to a report by the Korea Agro-Fisheries & Food Trade Corporation (aT), domestic sales of instant noodles in May were about $55 million compared to the same month last year, up 40 percent. It said the continued popularity of K-pop will provide a fresh impetus in terms of boosting other Korean products such as instant noodles. The export volume of instant noodles has been seeing double-digit growth since February this year when COVID-19 started to affect the entire world.

“The sharp increase in exports of instant noodles to the United States in the first half of the year was partly due to the trend of hoarding for an emergency. Additionally, local companies are preparing online sales channels expecting people will soon shop more on the internet,” an aT official said.