Retailers scramble to curb costs as weak won, Iran war drives up food prices
2026.06.11 05:00
Retailers and food suppliers are scrambling to contain rising costs as a weak won, high oil prices and climate-related supply disruptions push up food prices.
“The price of some cutlass fish has doubled," said Seo Ji-su, who has been running a shop at Noryangjin Fish Market for 17 years. "Four to five cutlass fish that sold for around 50,000 won [$33] a year ago now cost as much as 100,000 won."
The price increases are discouraging shoppers.
“Even when I sell fish at almost no margin, many customers simply walk away because the prices are so high,” Seo said.
Korea's retailers are facing mounting pressure from inflation, a weak won and elevated oil prices. Imported goods have become more expensive due to a weak won, while domestic seafood prices have also risen sharply amid soaring fuel costs and abnormal weather conditions.
The average auction price of a kilogram (2.2 pounds) of cutlass fish at Noryangjin Fish Market during the first week of June was 20,700 won, up 39.9 percent from a year earlier, data from Suhyup Noryangjin Fisheries showed Wednesday.
Prices for king crab and croaker also increased by 32.7 percent and 27 percent, respectively.
“Marine diesel prices used to be 800 to 900 won per liter [$1.99 to $2.24 per gallon], but have surged to 1,300-won levels because of high oil prices stemming from the Iran war,” a seafood industry source said.
“More fishermen are giving up fishing because of fuel costs. Climate change has already reduced catches, and reduced fishing activity is worsening supply instability,” the official added.
The Ministry of Oceans and Fisheries announced plans to release up to 8,000 tons of government stockpiled seafood into the market through July 15. The supply will include 5,500 tons of pollock, 1,000 tons of mackerel, 900 tons of squid and 600 tons of cutlass fish.
Major retailers are also struggling as the dollar-won exchange rate remains above 1,500 won.
Many imported agricultural products, livestock products and processed foods are purchased in dollars, and fierce competition makes it difficult for retailers to immediately pass higher costs on to consumers. Imported food products that have seen price increases are already experiencing declining sales.
In response, Emart will begin selling Chilean mackerel later this month.
The company sourced Chilean mackerel as an alternative to Norwegian imports after import costs rose because of the weak won. The price of Norwegian mackerel was about 18 percent higher on Wednesday than a year earlier.
Salted Chilean mackerel is expected to sell for between 4,000 and 5,000 won per two fish, about 50 percent cheaper than Norwegian mackerel. The product is also roughly 30 percent cheaper than domestically sourced mackerel.
“The move is intended to minimize price increases for consumers,” an Emart spokesperson said.
Emart has been selling Irish beef after U.S. beef prices increased. The retailer also worked with suppliers to pay for Norwegian salmon supplies in Norwegian kroner, rather than dollars.
Lotte Mart increased its purchase of Australian beef — which is around 10 percent cheaper than U.S. beef — by 10 percent. The company has also reduced costs for Norwegian salmon sashimi by securing large-volume contracts in advance and reducing intermediary distribution stages.
Food manufacturers are facing growing pressure because of their dependence on imported raw materials.
Lotte Wellfood said in its first-quarter business report that a 10 percent increase in the dollar-won exchange rate would reduce its pre-tax profit by about 5.7 billion won.
CJ CheilJedang said a 10 percent rise in the dollar-won exchange rate would reduce profit after taxes by about 6.7 billion won, including foreign exchange valuation gains and losses.
“A weak won combined with the Iran war has begun to significantly affect earnings through higher costs for oil and fat-based products and packaging materials,” a food industry official said.
“We are responding by diversifying suppliers, but profits will inevitably deteriorate because raising consumer prices isn't easy,” the official added.
Consumers could face even higher prices if current conditions persist.
“If the weak won and high oil prices continue through the second half of the year, retailers will have little choice but to adjust prices, increasing the burden consumers feel from inflation,” said Lee Hong-joo, a professor of consumer economics at Sookmyung Women's University.
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