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Korean food, fashion companies breathe 90-day sigh of relief after Trump tariff delay

Published: 11 Apr. 2025, 22:16

U.S. President Donald Trump attends a cabinet meeting at the White House in Washington, D.C. on April 10. [REUTERS/YONHAP]

Korean food and fashion companies expanding exports to the United States are breathing a sigh of relief after the U.S. government decided to delay reciprocal tariffs for 90 days.

Industry players are now calling on the Korean government to secure meaningful concessions during the grace period.

Samyang temporarily spared

The food industry had anticipated that kimchi and ramyeon would be the hardest hit by tariffs initiated by President Donald Trump.

Samyang Foods, currently at its peak thanks to its Buldak Ramyeon line — known for its spicy taste — was particularly vulnerable. The company does not operate a production facility in the United States and exports all of its products from Korea.

Samyang’s overseas sales surpassed 1 trillion won ($698 million) for the first time last year, with both North American and South American sales accounting for 28 percent of that figure. Since ramyeon operates on relatively low profit margins, tariffs would force companies to either raise prices or sacrifice profits. In response, Samyang quickly formed a task force to prepare for the fallout.

“We’re relieved that the tariffs have been postponed,” a Samyang Foods official said. “But Trump’s tariff policy is highly unpredictable, so we’re maintaining an internal emergency posture and continuing to review countermeasures.”

Ramyeon, or instant noodle, products are displayed at a supermarket in Seoul on Nov. 15. [YONHAP]

A food industry official noted that companies without overseas manufacturing facilities face challenges adapting quickly.

“There’s growing concern that tariffs could derail the upward export trajectory of K-food,” the official said.

Daesang, the top kimchi exporter to the U.S., is also feeling temporarily relieved by the 90-day deferral. Although the company opened a plant in Los Angeles in 2022, it only covers part of local demand. More than half its U.S. sales still rely on exports from Korea, making it susceptible to future tariffs.

“The United States’ tariff policies are so uncertain that it’s difficult for individual firms to prepare,” another industry insider said. “The government must actively intervene during this window to maintain K-food’s global popularity and resolve the tariff issue.”

The Nike logo [REUTERS/YONHAP]

Fashion industries weigh relocation

Korean apparel manufacturers with overseas factories are also considering diversifying their production bases in the long term.

OEMs such as Youngone Corporation, Hansae and Hwaseung Enterprise currently operate factories in Vietnam and Bangladesh. The United States has proposed tariffs of 46 percent on Vietnamese imports and 37 percent on Bangladeshi products.

These Korean OEM suppliers manufacture goods for brands like Nike, Lululemon and The North Face and fear that new tariffs will significantly eat into their profit margins.

To mitigate the impact, Hansae has been exploring options to shift production to Central America. However, Youngone and Hwaseung, whose factories are concentrated in Southeast Asia, are more exposed to potential tariff shocks.

Despite the tariff threats, some in the industry argue that clothing manufacturers are unlikely to return to the United States.

Tadashi Yanai, founder and chairman of Fast Retailing, which owns global SPA brand Uniqlo, criticized protectionist tariff regimes during a press briefing on April 10.

“A tariff system that prioritizes only domestic interests is unacceptable and will isolate the United States,” said Yanai. “The trend of apparel makers moving their production from China to lower-cost countries will continue.

“There is no possibility that apparel manufacturing will return to the United States,” he said.

Fast Retailing currently operates 380 factories worldwide, including 60 in Vietnam, 27 in Bangladesh and 19 in Cambodia. The United States remains the world’s largest consumer of apparel and footwear, but according to foreign media reports, only 2.5 percent of clothing and 1 percent of footwear sold in the country are made domestically.

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.

BY HWANG SOO-YEON [[email protected]]