K-Beauty, Food Firms Seek Alternate Routes as Middle East Conflict Disrupts Trade

U.S. and Israeli military operations against Iran are raising uncertainty for South Korean cosmetics and food companies that have been expanding aggressively into the Middle East. With air and sea routes in the region blocked, CJ Olive Young has announced delivery delays to the Middle East, while Samyang Foods is reviewing options to bypass the Strait of Hormuz for its exports.

According to the Korea International Trade Association, cosmetics exports to the United Arab Emirates reached $286.5 million (approximately 420 billion won) last year, up 67.2% from the previous year. Exports to other Middle Eastern countries also surged during the same period: Turkey (30.9%), Saudi Arabia (34.1%), Kuwait (55.5%), and Israel (183.3%).

The Middle East is emerging as the next major market for K-beauty, following North America, Japan, and Europe. According to global market research firm IMARC Group, the Middle Eastern cosmetics market, valued at $19.23 billion (approximately 28 trillion won) last year, is projected to grow 3.5% annually to reach $26.24 billion (38 trillion won) by 2034. Reflecting this optimism, Ulta Beauty—often called "America's Olive Young"—opened a physical store in Dubai in January, marking its full-scale entry into the region.

Korean beauty companies have also been cultivating the Middle Eastern market. CJ Olive Young signed a memorandum of understanding with local distributor Life Healthcare Group (LHG) in November last year to bring K-beauty brands to the region. At "Beautyworld Middle East 2025," the region's largest beauty expo held in October last year, 274 K-beauty brands and companies participated, including Medicube (APR), Aekyung Industrial, COSRX (Amorepacific), and Centellian24 (Dongkook Pharmaceutical). Silicon2 established a subsidiary in Dubai last year and began operating a logistics warehouse.

"The Middle East is a market where K-beauty growth is particularly promising due to intense sunlight, dry climate, and hijab-wearing habits that drive high interest in skincare," said an industry official. "We're concerned this situation will hurt the sector."

Food companies that have actively invested in halal products—food permitted under Islamic law—are also monitoring developments closely. According to the Ministry of Agriculture, Food and Rural Affairs, food exports to the Middle East reached $411.6 million last year, up 22.6% from the previous year. This growth reflects rising local interest in K-food and aggressive export efforts by CJ CheilJedang, Samyang Foods, Nongshim, and Ottogi, all of which have obtained halal certification. In December last year, CJ Group Chairman Lee Jae-hyun visited the UAE to discuss halal food growth strategies and announced plans to accelerate K-food business expansion in the Middle East, focusing on the UAE and Saudi Arabia.

The impact of the Middle East crisis is already materializing. On the 1st, Olive Young's global mall announced that "airspace in some regions has been temporarily closed due to the situation between the U.S. and Iran," warning of potential delivery delays to Bahrain, Qatar, Israel, the UAE, and Saudi Arabia. A Samyang Foods representative said, "Exports to the Middle East require passage through the Strait of Hormuz, but Iran's Revolutionary Guard has blockaded it. We are reviewing ways to bypass it." Food companies, which rely heavily on imports for raw materials, are also concerned about rising indirect costs from higher exchange rates, fuel prices, and shipping freight rates.

The tourism industry is watching developments closely as well. Hanatour and Kyowon have begun securing flights via Oman or India after travelers using their products became stranded in Dubai and other destinations. With Dubai—a key transit point for European package tours—becoming difficult to access, companies are also exploring alternative routes. However, according to the Korea Tourism Organization, visitors from six major Middle Eastern countries totaled only 39,828 last year, accounting for just 0.2% of all inbound tourists, suggesting limited overall impact on the tourism industry.