hankyoreh

By Ryu Yi-geun, staff reporter

While foreign tobacco companies have increased their share of the South Korean market, South Korean tobacco companies have been expanding their own overseas market share, Korea Customs Service (KCS) data show.

The report on recent trends in tobacco imports and exports, published by the KCS on Aug. 22, showed South Korean tobacco imports rising from US$249 million in 2003 to US$395 million last year - a jump of over 59% in a decade.

According to figures from KT&G, the country’s leading tobacco company, the market share for three foreign companies - Philip Morris Korea, BAT Korea, and JTI Korea - stood at 23.2% in 2003. By late 2013, it was up to 38.3%. Over the same period, KT&G’s own share dropped from 76.8% to 61.7%.

But with sharply rising exports, South Korean tobacco companies have made up for their losses on the local market with an overseas trade surplus. Between 2003 and 2013, tobacco exports more than doubled from US$237 million to US$553 million. In 2003, the country had a trade deficit in tobacco, with imports outpacing exports. But since the balance entered the black the following year, every year has seen a surplus. Indeed, the scale of the surplus rose nearly sixfold from US$27 million in 2004 to US$158 million last year. A surplus of US$123 million was recorded just in the first half of 2014.

The main export market for South Korean tobacco is the United Arab Emirates, which accounts for 31%.

South Korea primarily imports tobacco leaves as a raw material from Brazil and Greece, while finished cigarettes are imported from the Philippines and Australia, among other countries.

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