With the peak summer season approaching, South Korea’s two biggest frozen-dessert makers, Binggrae and Lotte Wellfood, are stepping up a fight for market leadership. Binggrae is betting that a merger with its subsidiary Haitai Ice Cream will deliver scale and help it reclaim the top spot, while Lotte Wellfood is countering with product upgrades and a heavier focus on overseas growth.
According to the industry on the 28th, Binggrae completed the merger process with Haitai Ice Cream on April 1, about five years after acquiring it in 2020. Food industry statistics show that in 2024 Binggrae held 27.6% of the domestic frozen-dessert market and Haitai Ice Cream 14.1%. Combined, that totals 41.7%, putting it ahead of market leader Lotte Wellfood at 39.9% and raising expectations of a shift in the competitive landscape.
Binggrae plans to integrate sales and logistics networks that had been split across the two companies, reduce overlapping costs and improve operating efficiency. It is also reorganizing its product lineup, consolidating overlapping categories around best-known flagship items and expanding joint purchasing of raw and packaging materials to improve its cost structure. Major brands such as Melona, Together, Bravo Cone and Babamba will be run under a single corporate entity, which the company expects will create synergies.
The company is also accelerating its overseas push. Binggrae plans to use its recently established Australian unit as a hub linking Oceania and Europe, adding to its presence in the United States, China and Vietnam. Its U.S. unit posted local sales of 97 billion won last year, helped by Melona’s popularity. In Europe, first-half 2024 sales of plant-based Melona were three times the total for all of 2023, the company said. Products from Haitai Ice Cream, which lacked a dedicated overseas organization, are also expected to expand exports by using Binggrae’s global distribution network.
Lotte Wellfood is responding with a two-track product strategy centered on premium branding and an expanded wellness lineup. It is steadily broadening its zero- and low-sugar offerings to match health trends, while strengthening the premium World Cone line and expanding categories using its Pig Bar brand to raise the share of higher-priced products.
Overseas, Lotte Wellfood is pursuing growth mainly in India. Its frozen-dessert sales in India rose about 3.3 times, from 58.7 billion won in 2020 to 196.6 billion won last year. With a new plant in Pune recently starting operations, the company aims to stabilize supply and expand its sales network beyond the west into the south, targeting 1 trillion won in sales by 2030.
The intensifying rivalry comes as the market environment worsens. With South Korea’s low birthrate shrinking the core consumer base and prices rising for inputs such as raw milk and sugar, companies are finding it harder to grow and protect margins. Binggrae’s operating profit last year fell 32.7% from a year earlier to 88.3 billion won, while Lotte Wellfood’s dropped 30.3% to 109.5 billion won.
An industry official said unpredictable weather linked to climate anomalies, a weak domestic economy and issues affecting naphtha supply are among the variables, but expectations for frozen-dessert sales remain high because heat has arrived earlier than usual and rainfall is forecast to be below average this year.
* This article has been translated by AI.
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