A McDonald's restaurant in Seoul, Friday / Yonhap

Food, beverage and liquor products in Korea are seeing price hikes. From burgers to coffee, breads and beers, popular consumer products have already seen their prices jump or are expected to soon.

The price increase across food sectors is due to the weakening Korean currency, causing manufacturers using imported ingredients to endure higher production costs and pass those costs onto consumers. Rising labor costs are also affecting the market, forcing business operators to offset the damage through higher sales per item.

McDonald's Korea on Friday said it will raise retail prices for 20 products from March 20, including burgers and coffee. The increases range from 100 won ($0.07) to 300 won, with an average price hike rate of approximately 2.3 percent.

The move came after McDonald's Korea increased the prices of 16 menu items by 100 to 400 won in May last year.

“Production costs have consistently risen due to adverse exchange rates and ingredient prices," McDonald's Korea said in a statement, adding the increase is an outcome of its efforts to minimize customer impact.

Asahi Super Dry products are on shelves at a discount chain store in Seoul, Feb. 23. Yonhap

New York Burger, a premium burger franchise in Korea, has announced it will raise prices for its burgers by 10 percent starting March 25.

Major Korean brewery HiteJinro earlier this month raised retail prices for 800 wine products and 200 champagne products it imports by an average of 1.9 percent. The company said the prices are determined by yields of natural produce in the producing countries and the exchange rate, and the factors forced the company to adjust the prices.

Lotte Asahi Liquor, a liquor arm of Lotte Group, raised the price of Asahi beers by up to 20 percent beginning March 1.

Major low-price coffee franchise companies in Korea have already raised prices for their coffee drinks. Compose Coffee and The Venti adjusted their prices by 11.1 percent to 30 percent.

Instant noodles, snacks, dumplings, breads and pastry products have also seen prices increase or are expected to do so as well.

Paris Baguette promotes its Hechi-inspired cake in front of its store, Dec. 27, 2024. Courtesy of SPC

Nongshim said it will raise prices for 56 instant noodle products and 17 snack products by 7.2 percent on average starting Monday. CJ Cheiljedang earlier this month raised prices for 20 dumpling products by up to 5.6 percent and spam products by 9.8 percent.

CJ Foodville's Tous Les Jours raised prices on March 1 for 94 bread products and 16 cakes by 5 percent on average, while SPC's Paris Baguette on Feb. 10 increased the price for 96 bread products and 25 cakes by 5.9 percent.

The surging cost of imported ingredients is one key reason for the hikes.

In a March 7 report, the United Nations Food and Agriculture Organization said its food price index for February this year averaged 127.1 points, up 8.3 percent from a year ago.

In a year-on-year comparison, the sugar index increased by 6.6 percent due to production declines in major producing countries such as India and Brazil.

The dairy product index, including cheese and butter, surged by 23.2 percent, while the price index for oils, including palm oil, canola oil, soybean oil and sunflower oil, rose by 29.0 percent.

Amid these challenges, an unfavorable foreign exchange environment is adding further pressure. Since December last year, the Korean won has consistently remained above 1,400 won per dollar.

Industry officials noted that rising ingredient costs typically impact domestic consumer prices with about a three-month lag, suggesting additional price hikes in Korea's food industry may be expected in the near future.

Wage increases are another factor. The minimum wage this year rose to 10,030 won per hour from 9,860 won last year, driving up costs for business operators who hire employees. Given 40 hours a week, each employee now costs an additional 2 million won at minimum for business operators.

An industry expert said both wages and ingredient prices spiked by a large figure, pushing companies to raise their prices to avoid losing money.