The home of K-Beauty, South Korea, has the smallest population amongst the world’s top 10 markets with only 50 million people, but it has the 8th largest market size in the world (Euromonitor1, 2022). K-Beauty became popular in the global market with the first ever introduction of 10-step routines, sheet masks, BB cream, CC cream and foundation cushions. Still, not many are aware that South Korea is the third largest cosmetic export country in the world after France and the United States, which placed ahead of Germany and Japan.
This small but mighty beauty powerhouse could not be free from the effects of the last three years of the pandemic. Multiple new trends and environmental changes have emerged due to the influence of Covid-19. The most dominant one is ‘sustainability’, with ‘clean beauty’ dominating the market in Korea. As a result of CMN’s expert survey (2022), “Clean Beauty” was selected as the first keyword in the market in 2023. Along with ‘vegan beauty’, words with eco-friendly images have formed the biggest trend.
These 38 CMN experts said that ‘core ingredients’ are the most searched for key word with 55.3%. Of those core ingredient searches, ‘hyaluronic acid’ was the most popular with 36.8%. Following that was ‘collagen’ (23.7%), ‘organic’ (18.4%), ‘ceramide’ (18.4%), ‘natural’ (15.8%), ‘vitamin’ (13.2%), ‘probiotics’ (13.2%), ‘peptide’ (10.5%), ‘fermentation’ (10.5%), ‘panthenol’ (10.5%), ‘tea tree’ (7.9%), and ‘centella asiatica’ (7.9%). In addition to ‘clean beauty’, plant extracts have been very popular searches in K-Beauty, with ‘collagen’, ‘centella asiatica’ and ‘houttuynia cordata’ all mentioned.
REACH24H Consulting Group Korea’s Seongmin (Mike) Sohn and Jaeyoung Kim also interviewed 5 exhibitors for in-cosmetics Korea.
Yeonjoo Ahn from NB Bio Company2 emphasized that most of the ingredient companies are fighting to follow the sustainability trend in Korea. They introduced PHYTO SILVER COLLA™ as a plant-derived collagen ingredients with upcycled materials made from coffee bean wastes, and their way of being more sustainable. EastHill Corp3 also created Trascobic™, a plant extract that promotes the differentiation of vitamin C transport proteins.
Both companies said that they create new products with ingredients that are already familiar to their consumers, but also look at finding Korea’s more unique raw materials to use. Jeju island is a well-known tourist spot in Korea and abundant with plant life, which has been used for some distinct plant extract ingredients. Jeju specialties are ‘camellia’, ‘citrus’, ‘green tea’, ‘rape’, ‘mulberry’, ‘turmeric’, ‘rock hydrangea’ and ‘evening primrose’.
COSEED Bio Pharm4 is one of the leading Korean suppliers providing low molecular functional products by various plants and marine ingredients originating from Jeju. They have 70+ products; ‘Machilus Japonica’, ‘Ficus Oxyphylla’ and ‘Cornus Kousa’ to name a few. Seonwon Kim, manager of Coseed Biopharm said that putting efforts into securing ingredients of Korean origin ingredients is very important but has become more difficult over time.
There are various protocols and regulations that have to be followed; like benefit-sharing with the Nagoya protocol, efficacy testing, safety testing, sustainability, technology (extraction, low molecularization, standardization), marketing (conceptual point, tools, measures), and most of all, complying with overseas regulations. With all the regulation and sustainability issues that have developed over the years, some Korean suppliers are seeking answers outside of Korea. “Smile Company5” introduced herbs collected from Cyprus, a Mediterranean island south of Turkey. ‘Everlasting’, ‘Rockrose’, ‘Watermint’, and ‘Houttuynia cordata’ are ingredients strictly controlled by the Cyprus government and Research Team leader Hyungjung Han says that these collections of raw materials are limited to companies with licenses. They’re either hand-picked or scissors-cut so even without the typical Korean origin story, it still appeals to consumers. It has the added bonus of having lowered regulatory hurdles for ingredient suppliers.
There are many products that have a comparative advantage based on their superior quality and are easier to produce thanks to the advances in technology. With R&D there’s been some new production technologies, such a separation and refinement, that have helped bring the industry into the future. With these advances it’s ramped up international competitiveness by having higher levels of hardware and excellent production facilities in Korea. To gain competitiveness of high-end manufacturing system, EFfCI-GMP (European Federation for Cosmetic Ingredients-Good Manufacturing Practice) certification has been one of the key requirements to pass. OptBio6, one of the leading extract manufacturers in Korea, has recently got certified for EFfCI-GMP for their second manufacturing site reaching up to 5,300㎡. Through this facility they introduced the GN Tannin Ampoule. It’s their unique product that has increased tannin content by 10 times compared to general extraction process through an eco-friendly method that destroys cell structure. This uses ultrasonic extraction, and it does not need the extra addition of solvents.
The Korean government’s interests, support policies, and public investment are needed for future K-beauty and raw material industries. It’s urgent to strengthen cosmetics regulations and support export licenses due to protectionism. To break the non-tariff barrier, two major approaches are executed; regulation monitoring with education and actual consulting service funding program to assist them for product registration in local markets. KCII, the only government body to promote K-Beauty industry has collaborated with REACH24H to provide regulatory updates, seminars and training and even published a guideline ‘How to comply with China cosmetic regulations’ in 2022.
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