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The Korea Mushroom Council Re-Enters the Chinese Market with Enoki MushroomsSuccess Anticipated Due to High Food Safety

An event of major importance for Korean enoki mushroom farmers took place recently in Qingdao. It was hosted by MAFRA (the Korean Ministry of Agriculture, Food, and Rural Affairs) and aT (Korea Agro-Fisheries & Food Trade Corporation) to celebrate the arrival of the first shipment of fresh mushrooms to the aT distribution center in Qingdao. Exported to China this October were 7.1 tons of enoki mushrooms. More than 30 tons of the mushrooms are expected to reach the country by the end of this year.

Up until 2010, about 5,000 tons or US$ 6.5 million worth of enoki mushrooms had been exported to China every year. All of them were supplied through consignment contracts between Korean farmers and Chinese wholesalers. China did not have many modernized cultivation facilities for enoki mushrooms back then, and the Korean produce helped to fill in the gap between the demand and supply. The Korean mushroom export industry experienced a boom at that time as Korean mushrooms—enoki, king oyster, etc.—were not only shipped en mass to China but also entered the markets of Southeast Asia.

However, things started to change with the Chinese government policy of providing support for the local cultivation of mushrooms, which led to a surge in China’s enoki mushroom production. To Korean farmers, this meant a rapid decline in exports after 2010. Until last year, the export volume to China has remained insignificant. Exports to Southeast Asia also decreased due to the inflow of Chinese mushrooms to countries like Vietnam and Indonesia.

“After signing an FTA with ASEAN in 2002, China has been receiving zero-tariff treatment on its agricultural produce. Thanks to the mutual tariff elimination, the trade between China and ASEAN saw a rapid growth. Mushrooms were one of the items that benefited from the zero-tariff treatment,” said Nam Sang-won, the head of the Korea Mushroom Council.

Guarding the Food Safety by Pesticide-Free Farming…Expected Increase in Sales
 

In these disadvantageous conditions, the organization that took the lead in exports of Korean mushrooms to China was the Korea Mushroom Council. It is an agricultural corporation established by nine mushroom farms in 2009 with the aim of pioneering the overseas markets. The farms developed a joint brand, K-Mush, under which US$ 1.2 million worth of enoki mushrooms were exported in 2015. This accounted for as much as 80% of the total exports of mushrooms from Korea last year. The products were shipped to an array of countries including the US, Netherlands, Vietnam, Australia and Indonesia. To provide more choices for consumers, The Korea Mushroom Council has recently started exporting king oyster mushrooms as well and is now taking up 50% of the total export volume.

“We brought mushroom farms together and thereby achieved the scale effect, which, in turn, increased the export volume. We grew into a coalition of farms, playing a leading role in developing the mushroom industry,” said Mr. Nam. 
 

The Korea Mushroom Council anticipates that China will become a major market for Korean mushrooms. They estimate the demand can be secured by emphasizing the strengths of the Korean products. And that is why all the eyes are on the first shipment of enoki mushrooms to Qingdao.

Korean mushrooms, both enoki and king oyster, are safer than their Chinese rivals because they are grown without using pesticides. To capitalize on this strength, it is planned that the mushrooms exported from October will be sold in premium supermarkets. The Korea Mushroom Council is also working on unifying the export channels to secure reliable counterparts in China. Utilizing the aT distribution center is one step in that direction. With the aT center as the base, the company plans to create a multi-functional export platform which can handle various tasks from mushroom import to marketing and distribution.

Processed Mushroom Products to Follow

In an effort to boost mushroom exports to China, the Korea Mushroom Council acts as the single exporter of enoki mushrooms to the market and works with a single Chinese vendor. This is expected to help building favorable environment for Korean mushrooms in the early stages of export as it can prevent unnecessary competition and facilitate the setting of a reasonable price range.

Mr. Nam emphasizes, “We have been trying hard to bring the enoki mushroom distribution system back to its normal state and carry out a variety of promotional activities. Currently, we are not seeking profits in China. Rather, our strategy is to introduce Korean mushrooms and build a stable market from the beginning. That is why we decided to have only one export channel.”

The long-term goal of the Korea Mushroom Council is to export processed products along with fresh mushrooms. The company has developed a number such products, including dried enoki mushrooms, enoki mushroom powder, and soy sauce braised mushrooms. Some advanced producers, such as the Netherlands, export half of their mushroom volume as processed food products.

The prospects of processed enoki mushroom export seem positive especially because enoki mushrooms are rich in chitoglucan which can help to lower triglyceride levels, thin the blood, and prevent arteriosclerosis.

“China is so vast, it is difficult to distribute fresh produce across the county, so we plan to enter the processed food market as well. Enoki mushrooms are already recognized as a functional food in Japan. I am confident that safe Korean enoki mushrooms will win the hearts of Chinese consumers in the future,” said Mr. Nam.

The Korea Mushroom Council
Tel : +82-2-6402-8624~6
Fax : +82-2-6402-8620
www.koreamushroom.co.kr

AgraFood  webmaster@kfoodstory.com

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