Smart farms emerge as Korea's top export contender in agri-tech push

Korea should broaden the scope of its K-Food exports beyond food products to encompass the wider agricultural industry — including smart farms, seeds and farm machinery — according to a new analysis. A comprehensive assessment of export competitiveness across eight industries, spanning agri-food and agricultural inputs, found that smart farms ranked highest overall. Researchers recommend moving away from exporting individual products and instead bundling seeds, farm machinery and smart farms into a single technology package for overseas markets.

The findings come from a Korea Rural Economic Institute (KREI) study on strategies to expand K-Food+ exports, released Tuesday. Researchers analyzed the competitiveness and inter-industry linkages of eight K-Food+ sectors: seeds, farm machinery, smart farms, agrochemicals, fertilizers, veterinary medicines, pet food and agri-food. After examining farm machinery, agrochemicals, fertilizers and veterinary medicines in the first year of the study, the team expanded its scope in the second year to include seeds, smart farms, pet food and agri-food, completing a comprehensive analysis of all eight industries.

Smart farms stood out as the most competitive sector. When researchers combined scores for "global market competitiveness" — which measures overseas market performance and market-entry potential — with "domestic export capacity," which assesses industry size and export capability at home, smart farms ranked first among all eight industries. Veterinary medicines, agrochemicals, agri-food and farm machinery followed in that order.

Smart farms also led on global market competitiveness alone, ahead of agrochemicals, veterinary medicines and farm machinery. On domestic export capacity, however, agri-food ranked first, followed by pet food, fertilizers and veterinary medicines. The overall ranking applied a weighting of 64 percent for global market competitiveness and 36 percent for domestic export capacity.

Despite their strong technological competitiveness, smart farms still need to build a more solid export foundation, the study found. Challenges cited include the burden of overseas certification and field demonstration, high logistics costs, and gaps in export infrastructure, research and development, financial support and after-sales service systems. Researchers said export strategies should be tailored to each market — water-saving technology for the Middle East, environmental, social and governance (ESG) and energy technology for Europe, and Official Development Assistance-linked models for Africa.

After-sales service is another challenge to address. Although 85.7 percent of smart farm exporters surveyed had participated in trade exhibitions — reflecting a heavy reliance on such events for overseas marketing — closing a contract in the smart farm industry typically takes a long time. Researchers recommended going beyond supporting exhibition participation to building follow-up management systems, training after-sales service personnel and establishing a shared service network.

The seed industry was also assessed as having strong growth potential. Key export varieties — including peppers, tomatoes and cabbage — are competitive on quality, but roughly 90 percent of Korean seeds are grown overseas and then reimported, creating a heavy burden in production and logistics costs. Shortages of research infrastructure and specialist personnel needed for new variety development, along with overseas certification and quarantine procedures, were also identified as obstacles to expanding exports.

Agri-food exports have grown consistently over the past five years, but heavy dependence on major markets — the United States, China and Japan — makes market diversification necessary, the study found. Researchers recommended maintaining a processed-food-centered export strategy while capitalizing on the growth potential of fresh produce, and developing differentiated strategies tailored to the demand and market characteristics of individual countries. Government support to reduce overseas certification costs and non-tariff barriers borne by companies was also flagged as a priority.

The analysis also found that linking individual industries could amplify the economic ripple effects of exports. Seeds, farm machinery, smart farms, and processed grains, fruits, vegetables and beverages showed relatively strong linkages with other industries. In agri-food particularly, growth in processed food exports had a greater impact on output growth than growth in fresh food exports.

In response, researchers proposed consolidating the export strategies pursued separately by each industry into a single value chain. On the production base side, seeds, fertilizers and agrochemicals would be linked together, while on the production technology side, farm machinery and smart farms would be combined. Agri-food and pet food could be connected at the processing and consumption stage — for example, by using byproducts from agri-food processing as raw materials for pet food.

K-Food+ inter-industry export strategy linkages (Source: Korea Rural Economic Institute)

Linked sectors — Seeds, farm machinery and smart farms: joint demonstration and export as a "K-Agri Tech" convergence package. Seeds, fertilizers and agrochemicals: an integrated solution linking production-base industries. Farm machinery and smart farms: package exports combining advanced production technologies. Agri-food and pet food: using agri-food processing byproducts as raw materials for pet food. Agri-food-related industries: global marketing tied to Korean Wave culture and other sectors.

Researchers proposed creating a "K-Agri Tech" convergence package combining seeds, farm machinery and smart farms, conducting joint field demonstrations, and then exporting in modular or turnkey formats. The KREI report also put forward additional cross-industry export models, including "K-Green Input" — bundling seeds, agrochemicals and fertilizers — "Seed to Table," linking seeds, smart farms and agri-food, and a circular model connecting agri-food and pet food.

To strengthen K-Food+ export competitiveness, researchers identified three core strategies: stabilizing the production and supply base, reinforcing technology and quality competitiveness, and building market access and global reach. They argued that agri-food and related industries must be developed as a single export ecosystem — through expanded contract farming and cold-chain infrastructure, development of functional and premium products, and a global brand strategy tied to Korean Wave culture.

"Going forward, export competitiveness can only be raised by building a K-Food+ ecosystem in which not just agri-food but related industries — seeds, smart farms, pet food and others — grow together," KREI associate research fellow Jeong Dae-hui said in the report. "There is a need to lay the groundwork for sustainable export growth through customized support suited to each industry's characteristics and through cross-industry linkage strategies."