In Korea, rice still wields strong influence as the staple food, but its annual consumption is gradually decreasing. The habit of eating rice for breakfast is disappearing and many Koreans prefer simply having some juice with bread and fruit in the morning. The per-capita rice consumption in Korea amounted to 130kg in 1984, has decreased to 83kg in 2003, and is estimated to have fallen to 63kg last year. Against this backdrop, the Korean government is carrying out campaigns to promote domestic rice consumption and encouraging farmers to export rice overseas. Recently, about 120 tons of Korean rice were exported to China, but further expansion to large-scale exports is unlikely.
South Gyeongsang Province, Sancheong County, and Hyoseong Food Co., Ltd joined their efforts and succeeded in exporting OgokHyeonmi SsalPpang Premix (a premix for rice bread with five grains and brown rice) to the US last year. This year, the producer, Hyoseong Food Co., Ltd is going to export 20 tons a month starting from June. The total volume, 240tons per year, is worth USD 1.2 million. The product is imported by Northgate Market, the biggest Latino market in the Los Angeles area. Established in 1980, Northgate is a large distributor, operating 42 stores and boasting an annual revenue of USD 1 billion.
Hyoseong Food Co., Ltd and Northgate Global Trading signed a LOI (Letter of Intent) on export of OgokHyeonmi SsalPpang Premix this April. According to the LOI, the two parties are to conclude a formal contract within 3 months, after deciding on the unit cost and quantity of exported goods.
Supplied to Northgate Market in the US
The signing of the LOI is a result of rice bread tasting events, which were conducted for bakery staff of Northgate Market on March 28–April 8. According to a survey, 90 percent of customers who tried OgokHyeonmi SsalPpang during that period showed favorable responses and expressed intention to purchase the rice bread.
Kang Ki-Hong, CEO of Hyoseong Food Co., Ltd, explains, “OgokHyeonmi SsalPpang Premix is a product made by mixing white rice—all of which is grown in Sancheong County—with brown rice, barley, corn, and other grains. We are building a system for making and supplying bread using this premix, and are sharing our baking technology and recipes with Northgate.”
Mr. Kang stressed, “Over 90 percent of local consumers whom we met during the tasting events gave the rice bread ‘good’ or ‘very good’ marks. Many of them asked what kind of bread it was as they could feel the difference from bread made with gluten.”
More Americans these days are becoming interested in living a healthy lifestyle. This trend encouraged the producer to emphasize the health benefits of the main ingredient, rice, and many consumers responded with positive purchase intent.
Crucial Role of Support from Provincial Authorities in Exporting Premix
The debut of OgokHyeonmi SsalPpang Premix in the American market occurred through a thrilling chain of events. First, last June, South Gyeongsang Province hosted presentations of Korean agricultural products during business consultations in Los Angeles, and an executive of Northgate showed interest in OgokHyeonmi SsalPpang. Following consultations, managers of Northgate visited the headquarters of Hyoseong Food in Sancheong County twice and went on a field trip to the factory producing OgokHyeonmi SsalPpang Premix.
Mr. Kang shares the company’s experiences: “We had participated in several Korean fairs for processed food, and our baguette baked with brown rice was a big hit. But even after opening our tenth franchise in the domestic market, we still thought we needed to advance overseas and were looking for a way to start export. The support of South Gyeongsang Province and Sancheong County was crucial in exporting the premix.”
The product is available in three types: bread, baguette, and other baked goods. The premix for general baked goods consists of 70 percent white rice and 30 percent mixed grains (brown rice, barley, and corn). The other two types contain fewer mixed grains and 10 to 15 percent gluten is added. The exact ratio of rice in the products varies according to the variety of rice used, which is part of the company’s knowhow accumulated through 10 years of trial and error.
Mr. Kang emphasizes, “The reason why rice bread had failed in the market in the past is because it was made by simply combining rice and gluten, without highlighting the merits of rice bread. We keep the flour at a minimum and use the appropriate rice ratio. This way, we can make the bread soft and delicious.”
Focus on Expanding the Export Market
What are the merits of bread made with OgokHyeonmi SsalPpang? Thanks to the fermentation process that uses an enzyme developed by Hyoseong Food Co., Ltd, the rice bread is as soft as wheat bread. The company does not add any artificial substances and uses only natural ingredients such as rice and mixed grains. In addition, the products satisfy consumers’ interest in novel goods. At present, the price difference between rice bread and wheat bread is only 7 to 10 percent, and it is expected to help the growth of its consumer base.
Mr. Kang said, “The moisture ratio in the premix is 1 percent lower than in gluten, so we ship it overseas without using preservatives. The fact that we haven’t come across any problems gives us additional confidence.” Mr. Kang also revealed his ambitions: “With recognition of our food safety from US FDA, we are ready to advance into Europe, Japan, Mexico, and many other countries. We also consider exports to the Middle East and Southeast Asia and are in the process of obtaining halal certification.”
Inquiries Hyoseong Food co.,Ltd
Home page www.ssalppang.co.kr
Park Sung Eun firstname.lastname@example.org
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