A bird’s eye view of CJ CheilJedang’s new plant in Hungary. Provided by CJ CheilJedang
CJ CheilJedang, which is seeking to sell its bio business division, will spend 800 billion won to build food production plants in Europe and the United States. It is interpreted as a move to prepare for the launch of the second term of the Donald Trump administration in the United States, which focuses on the high-growth global food business and emphasizes placing the country first.
CJ CheilJedang announced on the 21st that it will build new factories in Hungary and South Dakota, USA. The new factory in Hungary, which will cost 100 billion won, has decided on a site in Dunaversani near the capital Budapest and has begun design. We plan to produce ‘Bibigo dumplings’ and sell them in the European market starting in the second half of 2026. The ‘Bibigo Chicken’ production line will also be expanded in the future.
CJ CheilJedang acquired German frozen food company Mainfrost in 2018 and secured a production base in Europe, but this is the first time it is building a factory in Europe. The strategy is to respond to the demand in the European dumpling market, which is growing rapidly by more than 30% annually, through the new plant in Hungary and to begin expanding the business in earnest.
In the United States, the company will spend 700 billion won to build a ‘North American Asian Foods New Factory’ in Sioux Falls, South Dakota through its subsidiary Schwan’s. When completed in 2027, it is expected to become the largest Asian food manufacturing facility in North America, equipped with steamed dumpling and egg roll production lines, wastewater treatment facilities, and a logistics center. The company announced that it plans to further solidify Bibigo’s No. 1 position in the U.S. dumpling retail market through the new plant in South Dakota.
Bibigo dumplings occupy 42% of the US dumpling market. This year’s sales growth rate is 33%, which is more than twice the growth rate of the entire US dumpling market (15%). Park Min-seok, CEO of CJ CheilJedang’s food business division, said, “This investment is of great strategic importance to respond to the increasing demand for K-food in the United States.”
Current status of CJ CheilJedang’s overseas food production bases. Provided by CJ CheilJedang
This large-scale investment plan is interpreted as a signal that CJ CheilJedang will focus its capabilities on its main business, the food business, especially the overseas food business with high growth potential. CJ CheilJedang’s overseas food business sales grew by more than 70% over the past four years, from KRW 3.154 trillion in 2019 to KRW 5.3861 trillion last year. During the same period, the proportion of overseas sales in total food sales also increased from 39% to 48%. They are trying to prepare for future demand growth by increasing production capacity in the United States, which accounts for 80% of overseas food business sales, and in Europe, where sales are growing rapidly.
In the related industry, there are also predictions that if the sale of CJ CheilJedang’s bio division is completed, the sale proceeds, which are expected to amount to approximately 6 trillion won, could be reinvested in overseas food businesses.
There is also an analysis that CJ CheilJedang’s construction of additional factories in the United States, where it has 20 production plants, is a measure to prepare for the launch of the second Trump administration. If the United States raises trade barriers in the future, the production capacity of local factories must be increased to free themselves from the burden of tariffs and save on logistics costs. US President-elect Donald Trump previously announced the expansion of tariffs, including the introduction of a universal tariff of up to 20% on imported goods.
**How might CJ CheilJedang leverage its existing market presence and brand recognition in Asia to gain footholds in the European and US markets? What specific strategies might they employ to adapt to local tastes and preferences?**
## CJ CheilJedang’s Global Food Expansion: An Interview
**Introduction:**
Welcome to today’s episode where we delve into CJ CheilJedang’s ambitious expansion plans in the global food market. Joining us today are two experts in the field: [**Guest 1 Name**], an analyst specializing in the food industry, and [**Guest 2 Name**], an international trade attorney with expertise in US-Korea relations.
**Section 1: Expanding Horizons – The Rationale behind CJ CheilJedang’s Investment**
* **Host:** CJ CheilJedang announced a significant investment of 800 billion won in new food production facilities in Europe and the United States. Could you both shed light on the factors driving this strategic decision? What market opportunities are they targeting?
* **Host (directed at Guest 1):** You mentioned a thriving European market for dumplings. Could you elaborate on that and explain CJ CheilJedang’s strategy for capturing a larger share?
* **Host (directed at Guest 2):**
Given the potential for trade policy changes under a new US administration, how significant is CJ CheilJedang’s investment in a large US production facility from a risk mitigation perspective?
**Section 2: Strategic Diversification – The Sale of the Bio Business and Reinvestment**
* **Host:** We know CJ CheilJedang is actively seeking to sell its bio business division. How would you assess the potential impact of this divestment on their focus and future growth, particularly in light of the plannedoverseas expansion?
* **Host (directed at Guest 1):**
There’s speculation that the proceeds from the Bio division sale could be reinvested into the food business. Do you see this as a wise strategy considering the current global economic climate and potential market fluctuations?
* **Host (directed at Guest 2):** From a regulatory standpoint, could this divestment potentially ease any concerns surrounding CJ CheilJedang’s operations in either the US or European markets?
**Section 3: Navigating Global Trade – Facing Potential Challenges**
* **Host:** The article alluded to the possibility of increased tariffs under a new US administration. How might this impact CJ CheilJedang’s expansion plans, both in the US and potentially other markets?
* **Host (directed at Guest 2):**
What are some of the key implications of strengthening US trade protectionism for Korean companies like CJ CheilJedang operating in the US food market?
* **Host (directed at Guest 1):**
Given the global nature of the food supply chain, how can companies like CJ CheilJedang mitigate risks associated with fluctuating trade policies and potentially disruptive geopolitical events?
**Section 4: Looking Ahead – The Future of CJ CheilJedang on the Global Stage**
* **Host:** Based on their current trajectory and the global food industry landscape, how do you envision CJ CheilJedang’s future in the next 5-10 years? Will they be a major player on the global stage or will they face increasing competition?
* **Host (directed at Guest 1):**
What are some emerging trends in the global food market that CJ CheilJedang might need to consider to maintain its competitive edge?
* **Host (directed at Guest 2):**
How do you see the evolving US-Korea trade relations impacting Korean food companies’ long-term expansion plans in the United States?
**Closing:**
Thank you to our guests for insightful commentary and analysis. This discussion highlights CJ CheilJedang’s ambition and strategic maneuvering in the global food market. Only time will tell how these bold investments will shape the company’s future.
