South Korean food and beverage stocks see rise in foreign investment

Foreign investors are increasingly purchasing shares in South Korea’s food and beverage sector despite recent market volatility. While the sector index saw a decline of over 9% between late August and late September, foreign ownership in food and tobacco rose to 11.98%.

Analysts suggest this trend is driven by expectations of improved profitability. Major food companies, including Lotte Chilsung, CJ CheilJedang, Nongshim, and Pulmuone, have implemented price increases for various products. When combined with stabilizing raw material costs—such as soybeans, corn, and pork—these higher selling prices are expected to boost profit margins.

However, the industry faces ongoing challenges. Rising costs for logistics, packaging materials, and imported ingredients due to exchange rate fluctuations continue to pressure manufacturers. While some companies benefit from a stronger won by reducing import costs, those with high overseas sales may face different currency-related risks.