Orion, Paldo and others expand local production and tailored strategies
President Lee Jae-myung and first lady Kim Hye-kyung visit the Imperial Citadel of Thang Long in Hanoi, Vietnam, a UNESCO World Heritage site, on Aug. 24 local time, watching a traditional performance with General Secretary of the Communist Party and State President To Lam and his wife, Ngo Phuong Ly. <Newsis>
[Insight Korea = Park Hyeon-ju]
President Lee Jae-myung’s state visit to Vietnam is giving fresh momentum to efforts to expand K-food exports. The move is expected to have a positive impact on Korean food companies that have long nurtured Vietnam as a key base for entering the Southeast Asian market.
According to industry sources on Aug. 24, Lee recently said on his personal social media account, in relation to the outcome of the summit, that “we strengthened the export foundation for Korean companies based on cooperation in major industries, including food.” He added, “We plan to further expand economic cooperation by promoting K-food export cooperation.”
As government-level cooperation discussions move forward, attention is also turning to the achievements of Korean food companies that have already put down roots in Vietnam.
Vietnam, a young country where half the population is in their 30s or younger and the economy continues to grow by more than 7% annually, has been cultivated by Korean food companies as a forward base for targeting the Southeast Asian market through production facilities and localization strategies. In particular, Orion, Daesang, Paldo and Ottogi have treated Vietnam not merely as an export market, but as a strategic hub covering all of Southeast Asia, and have continued to move aggressively.
Orion’s 20-year localization pays off, with sales surpassing 500 billion won and ASEAN hub ambitions
Orion headquarters. <Orion>
Orion is regarded as one of the most successful localization cases in Vietnam’s food market. Since establishing its local subsidiary in 2005, the company has built brand trust and pursued locally tailored strategies for nearly 20 years. Last year, its Vietnam subsidiary posted sales of 514.5 billion won, surpassing the 500 billion won mark for the first time. Vietnam accounts for about 25% of Orion’s total overseas sales.
Orion is not stopping there. The company is investing a total of 130 billion won in Vietnam to significantly expand its production infrastructure. It plans to complete a new building at its Yen Phong plant in Hanoi in the second half of this year and add rice snack production lines as part of an aggressive market expansion drive. A third Hanoi plant, which will house a logistics center and packaging facility, is also targeted for completion by the end of the year. Orion’s rice snack An and fish-shaped snack Bong Bang are among its representative localization success stories.
“Once the third Hanoi plant is completed, we expect to establish a nonstop production system integrating production, packaging and logistics, further improving overall production efficiency,” an Orion official said. “We plan to increase production capacity to around 900 billion won going forward.”
The role of Orion’s Vietnam subsidiary is also expanding beyond the domestic market to become a regional export hub. “The Vietnam subsidiary is expanding exports to neighboring Southeast Asian countries, including Indonesia, Thailand and Myanmar, as well as parts of Africa,” the official said. “We are developing it into a core production and export base covering not only the ASEAN market of about 600 million people but also the broader Indochina Peninsula.”
The company is also diversifying its product portfolio in line with health trends. It is rolling out low-sugar versions of major brands such as Choco Pie and Custard, while expanding the lineup of its mass-market bread brand C’est Bon, actively targeting the fast-growing health and breakfast replacement market among young Vietnamese consumers.
Daesang’s 30-year commitment makes it No. 1 in seaweed market share
Daesang was the first Korean food company to enter Vietnam, moving into the market in 1994. Starting with MSG production and sales, the company gradually expanded into starch sugars, general foods and processed meat. Its Vietnam sales reached 235.9 billion won last year, nearly doubling from 2018.
In particular, Daesang has firmly secured the top position in the local seaweed market. Beyond seaweed, its K-food lineup, including tteokbokki, hot dogs and kimchi seasoning, is also gaining strong popularity among local consumers. In 2016, the company acquired Vietnamese processed meat firm Duc Viet Food, expanding into the chilled and frozen food markets.
Daesang is also moving aggressively to expand production infrastructure. In May 2024, it invested a total of 30 billion won in its Hai Duong and Hung Yen plants, adding new production buildings at each site. As a result, annual production capacity at the Hai Duong plant increased by 40%, while capacity at the Hung Yen plant more than doubled. The company is also producing Jongga kimchi locally in Vietnam.
“Vietnam is seeing the formation of diverse processed food categories and new consumer markets as global food companies aggressively enter the country,” a Daesang official said. “With Daesang’s food manufacturing know-how and modern production facilities, we aim to grow into a leading comprehensive food company in Vietnam.”
Vietnam overtakes Korea as top ramen-consuming country, prompting Paldo and Ottogi to accelerate expansion
Paldo’s second plant in Vietnam. <Paldo>
Vietnam is also a market ramen companies cannot afford to miss. According to the Korea International Trade Association, Vietnam’s annual per capita ramen consumption stood at about 81 servings in 2024, surpassing Korea’s 79 servings to rank first in the world. That amounts to an average of six to seven servings per month, making Vietnam one of the world’s most enthusiastic ramen markets.
Paldo entered Vietnam in 2006, establishing local subsidiary Paldo VINA and launching Koreno, a Korean-style boil-cooked ramen, to pursue a differentiated market strategy. Paldo VINA’s sales nearly doubled from the 60 billion won range in 2022 to about 116.9 billion won in 2024, maintaining solid growth momentum. Products made at its northern Hanoi plant are now exported not only across Vietnam but also to Taiwan, China, Thailand, Cambodia, the Philippines and Myanmar.
To meet rapidly growing demand, Paldo completed its second plant in Tay Ninh Province in southern Vietnam in 2024. The second plant can produce not only ramen but also beverages, further diversifying the company’s business portfolio.
The second plant has annual production capacity of 100 million ramen units and 150 million beverages. Once planned line expansions are completed, ramen production capacity will increase to more than 400 million units a year. Combined with output from the existing first plant, Paldo will have an annual ramen production system of 700 million units in Vietnam alone.
Ottogi also entered Vietnam relatively early, in 2007, and operates two manufacturing plants, one in Binh Duong near Ho Chi Minh City and another in Bac Ninh Province in the north. Ottogi Vietnam posted sales of about 89 billion won last year, maintaining average annual growth of more than 18% over the past five years.
Its flagship local product is Korean-style ramen. To target the “soaking noodle” market, which accounts for more than 80% of Vietnam’s ramen market, Ottogi launched six types of Oppa Ramen in 2023, formally entering the country’s core ramen segment. Reflecting the K-food boom, the company is also supplying 15 varieties of jajang ramen, popular among younger consumers, to respond to new demand.
“Vietnam’s distribution market has recently seen a sharp rise in demand for high-quality products due to the growth of the middle class and rapid urbanization,” an Ottogi official said. “We are responding to customer needs by quickly launching related products.”
Industry watchers expect Korean food companies’ investment in Vietnam and expansion of local operations to gain further momentum now that K-food export cooperation was formally discussed as an agenda item at the Korea-Vietnam summit. Localization capabilities and production infrastructure are expected to become key factors determining future market performance.
-This article was translated by ChatGPT. (이 기사는 챗GPT가 번역했습니다.)
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