What: South Korean eco-friendly produce market shows growing consumer interest but faces significant price barriers, prompting government intervention through subsidies and promotional initiatives.

Why it is important: This trend highlights the universal challenge of balancing sustainability with affordability in retail, demonstrating how government intervention can help bridge the gap between consumer interest and purchasing power.

South Korea's eco-friendly agricultural sector is experiencing a complex market dynamic, with consumer interest growing slightly to 76.8% while facing persistent affordability challenges. The primary motivations for purchasing eco-friendly produce reveal an interesting hierarchy of consumer priorities, with safety (39.5%) and family health (31.1%) significantly outweighing environmental concerns (13.6%). However, price remains the dominant barrier, with 65.1% of consumers citing higher costs as their main reason for avoiding eco-friendly products. The market's challenges are further evidenced by declining total sales, with revenue dropping by 158.3 billion won to 2.04 trillion won, despite an increase in retail outlets to 6,099. This paradox of growing consumer interest versus declining sales has prompted the Ministry of Agriculture to implement new initiatives, including production subsidies and promotional discounts, aiming to make eco-friendly foods more accessible to a broader consumer base.

IADS Notes: The South Korean government's initiatives to make eco-friendly foods more affordable reflect broader global trends in sustainable retail. In February 2025, data showed that while 47% of global companies are incorporating sustainability features into new product launches, 40% of consumers still cite high prices as the main barrier to adoption. This price sensitivity extends across income levels, as evidenced by September 2024 research showing that even among households earning over $100,000, only 45% are willing to pay a 10% premium for sustainable products. The regulatory landscape is also evolving, with March 2025 seeing the EU introduce comprehensive regulations requiring retailers to fund waste management and meet specific reduction targets. Consumer behaviour is shifting accordingly, with December 2024 data revealing that 41% of consumers now choose repairs over replacement, while 24% actively engage in sustainable shopping practices. In response, major retailers are increasing their investment in sustainability initiatives, focusing on product development and supply chain optimisation, similar to the Korean government's approach to making eco-friendly options more accessible through subsidies and promotional discounts.

Korean shoppers buy more eco-produce, but prices remain a hurdle