Anger as Price of Soju Increases

price-of-soju-bottle-increases

While South Koreans consistently voice concern about the rising cost of university tuition, housing, ramen, and cabbage, nothing may be more sensitive than the price of soju. Sold for 3000 won (2.8 USD) in a majority of restaurants and bars, the green bottles seemed immune to the rising cost of living in South Korea. That is, until the beginning of this year, when distillers reacted to the rising cost of ingredients by raising prices, starting a cascade that seems like it will end with a new normal, 4000 won (3.75 USD) a bottle soju.

Otherwise dry economic data about increases in wholesale costs vs. production cost have become fuel for accusations of greed by restaurant owners and above all, incompetence in the Lee Myung Bak government.

From Money Today:

‘Lunchtime Concerns’ Food Prices Skyrocket, Soju to Hit 4000 won

Located in the Moonbae district of Yongsan, the restaurant “Yukkal” is well known for its kalguksu, which it serves with a steaming bowl of yukgaejang. Around lunchtime, there is a line of customers out the door. In recent days, a single sheet of paper appeared on the left side of the restaurant’s menu, reading “due to an increase in the price of ingredients, starting on January 1st, Yukkal will increase the price of its signature dish from 7000 won to 8000 won, and the price of kalguksu from 5000 won to 6000 won.”

Elsewhere in Seoul, on Seo-somun Street, Hanseong, a restaurant famous for its chittlins, announced that it would raise its price for a bottle of soju to 4000 won. Hanseong, along with the twenty other restaurants in the Seo-somun business association, decided to collectively increase their price for a bottle of soju from 3000 won to 4000 won.

According to sources within the restaurant industry, starting on the 18th of this month, increases in the price of flour and soju will lead to secondary price increases at establishments in Seoul.

soju price rise

Soju now at 4000 won a bottle, menu prices continue to rise

Increases in restaurant prices are only beginning, further jumps are expected in the near future. In particular, there are signs that the largest increases will happen once the Lunar New Year holiday ends. At a large restaurant in Seoul’s central Gwanghwamun district, an employee said, “we are carefully watching for any resistance to the new prices from customers but when the New Year holiday ends, we have no choice but to increase the prices on our menus.”

According to a source in the liquor industry, “Chamisul has already increased its wholesale price, but since prices for Chum-Churum have not increased, restaurant owners have been reluctant to increase liquor prices…However, with Chum-Churum increasing prices on the 19th, most restaurant owners will finally increase their menu prices.”

Business associations in some districts are choosing to collectively increase their soju prices, such as the Mutual Aid Society of Seoul’s Guro District. In order to minimize objections from customers, the one hundred member restaurants will wait until after the New Year to increase liquor prices.

Price increase magnified, consumers shocked

All of these price increases are increasing the burden on average citizens. One reason is that the increase in menu prices is far outpacing the actual increase in wholesale prices. For example, the cost to manufacture a bottle of soju has increased by 72.8 won per bottle, or 8.1%. Increases in the cost of production means that the price for restaurant wholesalers has risen by 100 won to an average of 1200 won per bottle. However, the 1000 won price increase that ultimately appears on restaurant menus is a full 33% increase.

“Food and alcohol prices on the menu are rising much faster than the real increases to the restaurant. It’s costing so much to eat out these days…It’s getting harder to make my decision of where to eat lunch, especially since my salary never seems to increase,” said Im Cheol-woo, an office worker on Seoul’s Yeoui Island.

Comments from Daum:

Pooh:

If the wholesale price only rose 10% I would have expected the cost of a bottle to increase by 100 won or 200 won at most, but it looks like it has been used as an excuse to raise soju prices by a full 1000 won, what the hell

레킹:

Those chiselers are getting out of hand with their price increases. In the future, whenever I would have had three bottles of soju I will only drink two. If I would have drunk two bottles of soju I will only drink one! To the restaurant and bar owners reading this, if you shamelessly increase the prices in your business, you will be ruined! Listen closely! Your customers will disappear haha

수꼴은인간쓰레기:

What is the minimum wage supposed to be these days, 4850 won? ke ke An hour’s pay wouldn’t even pay for a bowl of noodles or seolleongtang. In this country, the only meal you could buy is kimbap and a bowl of ramen at Kimbap Heaven… or something off the McDonald’s lunch menu…shit, making minimum wage you can’t even pay for a decent meal in this country…

몽돌이:

Soju for 4000 won a bottle? 5000 won for a bowl of kalguksu? What the hell, my income never goes up but the cost of living seems to constantly jump higher and higher

두둥둥:

Just five years ago, during the presidency of Roh Moo-hyun, it seemed like the price of lunch was just 5000 won. Now it’s 7000 won, 8000 won. It sure is a good thing we picked a president who was so good for our economy…

코알라:

I have been keeping track of my family expenses, so I know that during the presidency of Kim Dae-jung, the average lunch cost was 3000-3500 won. Under Roh Moo-hyun it was 4000 won. After five years under President Lee Myung-bak, it is now 6000-7000 won. An “economic-focused” president seems to be ruining his people.

정주지아느리:

I don’t know. It looks like it’s everyone for themselves after the election…

머리통:

The reality of Lee Myung-bak’s “747” campaign promise: 7000 won for a meal, 4000 won for soju, 7000 won for lo mein

우짤건지:

Get rid of them and just eat your meals at home

거리도사:

So the cost of producing a bottle of soju goes up by 100 won and the restaurant charges an extra 1000 won!!!!!!!!! What a bunch of thieves. Let’s take this seriously, brace ourselves, and refuse to go to restaurants for one month. Only then will restaurant owners lower the price of soju.

hororo:

Even if the cost of ingredients plummets, those chiselers refuse to drop prices by even a tiny amount. Rotten thieves

리우:

These days the only way to survive is by drinking water, everyone is raising prices

정신차리기:

The government is putting its citizens on a diet.. Nowhere else would you see something like this! Only here would the government manage our waistlines

별하나:

Shit, now I’m scared to drink soju…

자칭꽃미남:

The only way to answer this is by buying 10,000 won of meat at the butcher shop, a bottle of soju at the corner store, and going home!!

maxwell:

Thank you.. keep raising prices like this until soju hits 10,000 won a bottle, I think I will be able to quit drinking after all

media daum:

His Royal Highness is just looking after our health, making us quit drinking and helping use to avoid restaurants that use lots of MSG

택권보이:

In America, 4000 won buys six cans of Asahi. This is one of the reasons why the standard of living is low in Korea.

반달로그:

Here I am at age 40 and everything seems to be increasing except for my salary…And yet people are still surviving and buying bigger houses than before, new cars, and traveling abroad…

한결같은나무:

Everyone pack their own lunch from now on. Let’s show them how tough things have gotten!!! Starve them out

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  • http://www.facebook.com/inahson Yaminah Jamison

    Kinda reminds me of the rising prices of cigs in the US… Think people would quit smoking as prices go up? Pfffttttt they just go somewhere cheaper, just like gas. People still gonna buy their soju regardless of price…

  • J.Shin

    They should look at Singapore’s pricing for alcohol and cigarettes.

    • Yu Bum Suk

      I had my most expensive pint of beer ever in Singapore.

      Korean restaurants should just price things American-style: W3,999. That way it’s not quite four grand.

  • http://karmaeconomics.blogspot.com/ lavista4u

    This would never happen in North Korea. good things are never told about NK by the western propaganda news. The price of Soju in NK is less than 1 dollar take that south korea and your crony capitalism :)

    • thmswhnr

      But then, if you consider that the GDP per capita in the South is over 30k USD and in the North is less than 2k USD, you realize that a North Korean must spend a much bigger chunk of his income to feed the habit.

      Actually, I bet the only people who are allowed to purchase soju in the North are the Kims and their minions…

    • Jang
      • PixelPulse

        Whats the point if you cant satisfy the munchies you get?

        • Brett

          Haha, chortle!

  • commander

    The outgoing adminstration puts its focus on economic growth by keeping the local currency’s value low, raising the import prices here. But now it failed not only miserably to revive the economy but also to bring inflation under control. The president-elect now faces the monetary easing in the U.S. and Japan, strengthening the won against the dollar and the yen, a situation helpful to reducing imports prices but bad for the exports-driven economy.

    It’s quite interesting how the first female president will respond to it.

    • chucky3176

      Inflation is under control. The Won is gaining strength rapidly. The only things moving up are the cost of fresh fruits and vegetables which have always been expensive, and getting more so.

      • Rutim

        The won is gaining ‘strenght’ because Japanese government decided to lower the price of it. That’s the only reason. Korea could now only try it’s best to reduce the negative impact of the three biggest guys around currency wars…

        • Rutim

          Sorry, not ‘it’ but ‘yen’.

          • chucky3176

            Korean won has been gaining against the US dollar since 2011, way before Japan started its suicide express. It’s the US monetary policy which is the reason, Japan has nothing to do with this. lol.. The Japanese are delusional thinking that they can have any kind of leverage over Korea. I thought it was proven that when Japan tried to weaken the Korean Won and bring out a financial panic in Korea, by threatening to stop a currency swap last fall. LOL fail. It only ended up proving how irrelevant Japan has become. lol..

        • chucky3176

          “Japanese government decided”?? Japan has zero leverage over Korea, other then lowering the Japanese Yen by turning the printing press harder. Dream on, Japan is no United States nor China. This of course will make Japanese Yen lower, but that will only engineer an out of control crash of the Yen as Japanese debt bomb explodes due to much higher interest rate.

    • http://www.facebook.com/patrick.j.stewart Patrick John Stewart

      Sadly, while it seems that import prices should be lower because of the value of the won, this hasn’t been the case. The importers selling the products in Korea have always been charging way too much for those products by about half as much as they could be bought in their native countries from clothes, to cars, to alcohol. While things haven’t really gone up like chucky says other than fruits and vegetables nothing has gotten cheaper and all imported products are still way over priced in my opinion.

  • Digitalsoju

    Everything but wages seem to go up these days.

    • Brett

      I don’t get it, soju’s price went up very little, not enough to justify a 1000won increase. Still a dollar at any mart in Korea.

      I don’t really care anyways, I’m a makkeolli man myself. And makkeolli is still 3000won at any restaurant.

      • Digitalsoju

        All the stuff that goes into soju seems mostly toxic anyway, did toxic material go up in price? ^^

        • vincent

          Nothing on Earth is as toxic as Baiju…

      • Kate

        My husband is too. We never drank soju in korea, but we had some fun times with makkeolli and playgrounds ^_^

  • Joe

    d

    • Yu Bum Suk

      Kyeongsangnamdo: CU (nee: Family Mart): 1,500. Mum-and-pop shops: 1,200 to 1,500. Supermarkets: 1,100 to 1,200 – a bit cheaper in a bulk case. Restaurants: 3,000. Noraebangs: I really don’t know. Someone else almost always foots the bill.

    • thmswhnr

      In Beijing, 12-15 kuai (2.00-2.50 USD) at 7eleven; 20-30 kuai (3-5 USD) at a restaurant.

    • anon

      Germany: can be about 11€ at a Restaurant ~

    • Joe

      €4,50 at a local shop here, which sells all kinds of Asian products, not just Korean. (Netherlands)

  • Brett

    Never, I mean NEVER, fuck with a man’s soju.

  • Joe

    “In America, 4000 won buys six cans of Asahi.” uhhh okay, just to get the record straight–this is not true.

  • chucky3176

    $4 for a bottle of alcohol is still cheap. Too cheap in my opinion. I say raise the sin taxes on cheap liquor and cigarrettes to at least three times, so that it will cut down on people becoming alcoholics and chain smokers. There’s too many drunks running around at night puking up the streets, sleeping on the streets, starting fights, and causing trouble. But I doubt this will ever happen, with all the places that sell cheap liquor, having to close up shop, the government is too scared to do what’s necessary. Heavy taxation would definitely hit all the pojangmachas and convenience stores, real hard.

    • chucky3176

      I say tax the pleasures that are harmful to the health, and use the money to pay for welfare. This would have the double benefit of healthier Koreans who are less hung up, relieve the costs on healthcare as well. But I doubt this will happen, with too many special interest groups, both corporate and small individuals, who will cry foul.

    • http://www.facebook.com/inahson Yaminah Jamison

      People will still buy, regardless how expensive it is.. just like people still do pot, crack, and other illegal drugs regardless how expensive it is.

    • Rutim

      Have you ever heard about something called ‘prohibition’? They’ll stop buying those in the shops. Instead they’ll drink from Chinese ship’s containers. And of course gigantic cartel groups fighting for places on the streets.

      Yes, taxing is a good idea. No doubts about that.

  • ChuckRamone

    I get angry when the price of alcohol rises anywhere in the world. It’s not right. People need to drink.

  • lovemysoju

    wow soju so cheap in korea! In Australia at our local korean drinking place it costs the equivalent of 15,500 won for a bottle of soju. Yes, that’s the same bottle of soju you drink in korea!

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