Calamansi is hot in Seoul, but can local suppliers deliver?

By Cathy Rose A. Garcia, Associate Editor

SEOUL — Calamansi is the latest food fad in South Korea, as health-conscious Korean women believe the Philippine lime is a good source of Vitamin C, and perfect for detox.

Calamansi juice and tea drinks, as well as calamansi-flavored cookies and even Peppero biscuit sticks, are being sold online and in supermarkets.

“I’ve tried calamansi, and I believe it helps to lose weight,” said Park Ja-young, an office worker, who first learned about its health benefits on Instagram.

Emmanuel W. Ang, Philippine Trade & Investment Center (PTIC) commercial counselor for South Korea, said he was surprised by the sudden interest in calamansi among Korean buyers this year.

“Calamansi is a very hot item right now. I regularly bring buying missions from Korea to the Philippines, and when Philippine companies  come here, I match them with buyers, so I know what the Korean market is looking for and right now, it’s calamansi,” he told BusinessWorld at the Philippine embassy on Oct. 19.

Mr. Ang noted a Korean food company they invited to the Philippines had developed a calamansi juice drink in Tetra packs, which are now being sold online and in stores.

“The Korean market for food and beverage is a very competitive one. There are so many products in the market, so companies are trying to differentiate to give new products to market. Calamansi has gotten to that stage where it’s very different from other lemon products. Probably before when they put calamansi as a flavor, some Koreans would not know what it was. I think we have come to the point where there are a lot of Korean tourists coming to the Philippines, they’re familiar with calamansi,” he said.

But while the interest in calamansi is strong, the question is whether Philippine companies, particularly small and medium enterprises (SMEs), can address the demand.

“The capacity to supply (the market) is the biggest problem. Generally, it’s not a problem of finding a buyer. It’s a problem of finding a supplier who can give the appropriate volume, quality, consistency, and supply that they need,” Mr. Ang said.

For instance, he recalled a Philippine exporter showcased coconut products at one of the trade fairs in Seoul. While they received many inquiries, the Philippine exporter was unable to fullfill  the orders from Korean companies since these were at volumes that they could not supply, or did not meet the packaging standards.

“That’s the problem — capacity — not just volume, but proper packaging, proper certifications that they need. Some exporters still don’t get that. When we supply to a market, we don’t ask the market to adapt to our product. We ask the market what do they need, and we change our product to meet the need,” Mr. Ang said.

The PTIC, which is under the Department of Tourism, regularly invite SMEs to Seoul to participate in trade fairs, and also bring Korean buyers to the Philippines.

“The Korean companies are looking for products they can source (from the Philippines). I’ve explained to them that we have the natural resources, but we have a problem with the processing part… But the Koreans, because they want to buy from us as well, they sent experts to talk about what they need from Philippine exporters. They talk about how a Korean company sources products, what are the certifications, documents they require,” Mr. Ang said.

Trade between Korea and the Philippines stood at around $7.75 billion in 2016. The Philippines exported around $2.5 billion worth of mostly semiconductors and electronics, fresh fruit such as bananas, pineapples and mangoes, and copper and other minerals to South Korea.

INTEREST REMAINS
Despite reports of some Korean manufacturing firms leaving the Philippines for Vietnam, Mr. Ang said Koreans are very keen on investing in the Philippines.

“We’re seeing investments in many industries, much more than before,” he said.

He noted Korean companies have previously invested in semiconductor and electronics manufacturing, shipbuilding, agri-business and food processing in the Philippines because of efficiency of production.

“They see manufacturing (costs in Korea) is higher compared to Philippines. Maybe they have problems with labor unrest here, so they see opportunities in leveraging quality and efficiency,” Mr. Ang said.

Korean firms involved in engineering and construction, as well as renewable energy, have also expressed interest in the Philippines to take advantage of the growing economy, particularly the government’s massive infrastructure program.

“They see Philippines is rolling out more of these big-ticket projects. And they want to be a part of that,” Mr. Ang said.

Korean companies, ranging from banks to consumer goods, are also entering the Philippines to take advantage of the growing middle-class market.

“We have a big population and we are slowly becoming more and more affluent. They see the economic growth we have had for the last six or seven years continuing and they want to take advantage of that,” Mr. Ang said.