Rice fields in south korea (Wikimedia Commons)
SEOUL, Oct. 15 (Korea Bizwire) – The government has decided to intervene in South Korea’s rice market as it announced it would purchase up to 180,000 tons of rice to ensure a stable national supply, its first move since 2010.
Growing worries that a bumper crop of rice and a decline in rice consumption may cause a glut and price slump, prompted the Ministry of Agriculture, Food and Rural Affairs (MAFRA), to buy freshly harvested rice of this year, plus another large amount of rice for an international aid in case of emergency.
This is largely due to notable declines in rice consumption in the domestic market. According to MAFRA, South Korea’s estimated per capita rice consumption is about 64.4 kilograms for one year beginning November this year. Annual rice consumption per person in South Korea recorded 132.4 kilograms in 1980 and that has steadily been on the wane and it will near 50 kilograms by 2022 according to the Office for National Statistics.
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“An estimated amount of rice to be harvested in 2014, as the Statistics Korea (KOSTAT) predicts, is 4.18 million tons, down 1.1% from the previous year, but led by a decline in rice consumption, the demand of rice for one year from November in 2014 to October in 2015 will amount only to about 4 million tons,” said Kim Kyung-kyu, a senior official on food policy at the ministry, on October 14. “Given the figures, the government intends to purchase the surplus new rice and put it aside, in an effort to prevent rice oversupply and stabilize new rice markets,”
The KOSTAT predicts that this year’s gross output of rice is more than the average year’s by 3.5%, albeit lower than the last year.
Although rice is the staple food for Koreans, demand for it is in notable decline. (image: Kobizmedia/Korea Bizwire)
MAFRA is determined to buy the rice surplus, but the government will make its final decision on the exact amount of rice to purchase in the following month when the yield and price of rice will be identified in concrete after harvest. It however will not put the purchased rice back on the market unless its intervention is urgent as the price of rice gets to be unstable, added the official.
Along with the purchase of the new rice surplus, estimated at 180,000 tons, the government will buy additional 370,000 tons of rice for public stock and another 30,000 tons, in order to secure food security in an emergency caused by temporary and large scale calamity and to distribute them to the countries in need, according to the scheme of ASEAN Plus Three Emergency Rice Reserve.
Korea’s average rice yield from each unit area of 10 hectares is predicted to rise 1 percent to 513 kilograms, according to the government. (image: Pixabay)
By Eugene Yu (eugene@koreabizwire.com)
