K-Beauty, Food Industries Face Growing Uncertainty Amid Middle East Tensions

Military operations by the United States and Israel against Iran are expected to increase uncertainty for Korean cosmetics and food companies that have been expanding into the Middle East. As air and sea routes in the region face disruptions, Olive Young has announced delays in product deliveries to the Middle East, while Samyang Foods is reviewing alternative routes that bypass the Strait of Hormuz.

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. Given that overall cosmetics exports grew 12.2% last year, the UAE showed particularly steep growth. The UAE rose from 12th place in 2023 to 9th in 2024 among export destinations, climbing another spot to 8th place last 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. Amid rising expectations, Ulta Beauty—often called America's Olive Young—opened an offline store in Dubai in January, marking its full-scale entry into the region.

Korean beauty companies have been actively cultivating the Middle Eastern market. CJ Olive Young signed a memorandum of understanding with local distributor Life Healthcare Group (LHG) in November last year for K-beauty brand distribution. 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). Additionally, Silicone2 established a subsidiary in Dubai last year and began operating a logistics warehouse in the fourth quarter. Numerous beauty brands have officially entered local beauty retail chains to reach consumers there.

"The Middle East is a market where K-beauty growth is highly anticipated due to intense sunlight, dry climate, and hijab-wearing creating strong interest in skincare. There are concerns this situation will cause damage," a beauty industry official said.

The food industry, which has actively invested in halal products (food permitted under Islamic law), is also closely monitoring the situation. 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. Amid growing local interest in K-food, CJ CheilJedang, Samyang Foods, Nongshim, and Ottogi have obtained halal certification and pursued aggressive export strategies. 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 in the Middle East, focusing on the UAE and Saudi Arabia.

Damage from the Middle East situation is already materializing. Olive Young Global Mall announced on the 1st that "airspace in some regions has been temporarily closed due to the situation between the United States and Iran," warning of potential delivery delays to Bahrain, Qatar, Israel, the UAE, and Saudi Arabia. A Samyang Foods official said, "Exports to the Middle East must pass through the Strait of Hormuz, but Iran's Revolutionary Guard has blocked it. We are reviewing alternative routes."

The food industry, which relies heavily on imports for raw materials, expects indirect cost burdens to increase due to rising exchange rates, fuel costs, and shipping fees.

The tourism industry is also watching the situation. Hana Tour and Kyowon are securing flights via Oman or India as travelers using their products to destinations including Dubai face disruptions. They are also seeking alternatives as transiting through Dubai—a major stopover for European package tours—becomes difficult. However, according to the Korea Tourism Organization, visitors from six major Middle Eastern countries totaled just 39,828 last year, accounting for only 0.2% of all arrivals, so the impact on the overall tourism industry is expected to be limited.