An Empirical Analysis of Korea's Agri-Food Exports Using the Export Function

In light of escalating global food prices and the volatility of supply chains, alongside uncertainties within the global economic landscape and potential threats to international supply networks, apprehensions regarding food security have surfaced. Consequently, it is imperative to investigate methodologies for augmenting the competitiveness of South Korea's agricultural sector, thus facilitating its transformation into a burgeoning export industry. Notwithstanding the adverse external conditions, South Korea's K-Food (agricultural and food products) industry attained an unprecedented export milestone of $12.1 billion in 2023, solidifying its status as one of the nation's twelve principal export industries. This research endeavors to examine the factors contributing to the sustained expansion of South Korea's agri-food exports by performing a comparative analysis of the demand and supply determinants for agri-food exports, delineating between total exports, agri-food exports, fresh produce, and processed food. The timeframe for analysis encompasses the years from 2013 to 2022, concentrating on five of South Korea's primary export destinations and three major economic regions through the application of panel data analysis. The holistic findings reveal that the income levels and economic growth rates of trading partner nations, in addition to export prices, exert a positive impact on South Korea's export performance. Nonetheless, it is observed that fresh food exports exhibit heightened sensitivity to the income levels of trading partners, whereas processed food exports are more substantially influenced by pricing factors. Moreover, investments in research and development (R&D) within the agricultural sector are demonstrated to significantly influence South Korea's agri-food export supply, with a more pronounced effect on fresh food exports relative to processed food exports.