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11.23 (토)

CJ CheilJedang expands U.S., European production facilities

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A bird’s-eye view of CJ CheilJedang’s new plant under construction in Sioux Falls, South Dakota, USA. (CJ CheilJedang)

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South Korea’s CJ CheilJedang is set to invest 800 billion won ($571 million) to build new production facilities in the United States and Europe. The move aims to strengthen its market presence in the United States while boosting production capacity in Europe. The expansion also appears to address potential challenges posed by protectionist trade policies anticipated under the upcoming Donald Trump administration in 2025.

The company announced plans to build North America’s largest Asian food production facility in South Dakota, on Thursday. The site, covering 575,000 square meters - roughly the size of 80 soccer fields - will require an investment of 700 billion won. In Europe, the company will invest 100 billion won to construct a new factory on a 115,000-square-meter site near Budapest, Hungary, which will be equivalent to 16 soccer fields.

“This decision reflects our commitment to expanding our dominance in the global food market. We aim to lead the global K-food wave and position ourselves as a global leading company by proactively investing in production capabilities for the future,” a CJ CheilJedang official said.

The South Dakota facility will be spearheaded by Schwan’s Company, CJ CheilJedang’s U.S. subsidiary. Equipped with production lines for dumplings and egg rolls, wastewater treatment systems, and a logistics center, it will be the largest Asian food manufacturing facility in North America and serve as a key production hub in the central United States. South Dakota’s excellent road and air infrastructure and business-friendly policies were cited as reasons for the location choice.

The decision also considers President-elect Donald Trump’s nomination of South Dakota Gov. Kristi Noem as his homeland security secretary. According to Moon Jung-hoon, a professor at Seoul National University, “K-food is increasingly becoming a meal replacement overseas. Given the regulatory barriers to exporting processed meat products from Korea to the United States and Europe, establishing local factories is an inevitable step.”

The new facilities are expected to further solidify Bibigo’s leading position in the United States dumpling market, where it held a 42 percent market share in the third quarter of 2024. Bibigo dumpling sales grew 33 percent from January to September, more than doubling the overall U.S. dumpling market growth rate of 15 percent. The company also plans to strengthen its position as the top Asian food brand in the United States, targeting the 1 trillion won egg roll market.

In Europe, the Hungary-based K-food plant is scheduled to begin producing Bibigo dumplings in the second half of 2026, with plans to add a Bibigo chicken production line later. The facility will address growing demand in the European dumpling market, which has been expanding by more than 30 percent annually. It will also serve as a base for entering Central and Eastern European and Balkan markets, including Poland, the Czech Republic, and Slovakia.

While CJ CheilJedang’s domestic food business has struggled with declining performance due to sluggish demand, its overseas food business has seen sustained growth. domestic food sales fell 6 percent on-year to 1.57 trillion won in the third quarter of 2024, whereas overseas food sales rose 5 percent to 1.4 trillion won. The company’s overseas food business has grown more than 70 percent over the past four years, from 3.15 trillion won in 2019 to 5.39 trillion won in 2023. The share of food sales in the company’s overall overseas revenue also increased from 39 percent to 48 percent during the same period.
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