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Rice Prices in Gyeonggi Province Fall 17 Percent

Posted September. 15, 2005 08:31,   


According to Anjung Nonghyup, an agricultural federation in Pyeongtaek City, a 40-kilogram sack of early maturing rice was selling for 48,000 won, a drop of 17 percent from last year’s price of 58,000 won.

It will be difficult to sell the complete harvest even at this price since only a few are buying the new crop of rice. This is a different situation from last year when buyers were competing to take the entire harvest.

After hearing the forecast for rice prices from the village head and the managing director of Nonghyup, farmer Lee Byeong-san‘s (68) face changed color. Lee did not plant any early maturing rice in his field; he only planted the later flowering variety, which is meant to be harvested after Chuseok.

Lee said, “I did not contract with Nonghyup to sell my harvest to them at the beginning of the year, so I will have to dry and hull the rice myself.”

It takes 170,000 won for an individual to dry 2,000 pyeong of rice by himself, which is 40,000 won more than it would cost using Nonghyup’s large machine. Also, milling a sack of rice is about 10,000 at the miller’s, but the government and Nonghyup offer this process free of charge.

The heavier burden in expenses for individuals who harvest rice by themselves is due to the government ceasing its purchase of the fall harvest and the limited number of purchase contracts that can be made with Nonghyup. Most of the farmers in Anjung-eup have applied for the minimum income for rice guaranteed by the government, a countermeasure to the abolishment of the government’s fall harvest purchases.

It seems that the people have acknowledged that the new income guarantee system is the only way to go this year.

Even still, Kim Gab-su (72) showed some unhappiness with the measure, saying that it is hard to pay for fertilizer since there are no advance payments in the government’s new fall purchasing plan. “It will be hard to give pocket money to my grandchildren for Chuseok this year,” he said.

Falling rice prices in other areas -

Prices for early maturing price have fallen in other areas of the country as well.

A 40-kilogram sack of rice was sold for 50,000 won at the Sinpyeong Agricultural Cooperation in Dangjin-gun, Chungnam Province, 4,000 won or seven percent lower than last year’s price. Last year’s stock was still piled up, and due to the economic stagnation, many customers are not buying the relatively expensive new crop rice.

The price for new rice dropped by 18 percent from last year in Jeonbuk Province, and eight percent in Jeonnam.

Choi Seong-yeol, head of the grain management team at Geumseong Agricultural Cooperation in Jeonnam, said, “With the rising temperature, many areas have started to cultivate their early maturing rice, and so supply is surpassing demand.” The price in Gyeongnam Province fell to 50,000 won from last year’s 55,000 won.

Government’s guarantee payment burden may become heavier-

Farmers are concerned about a drop in rice prices, but the Agriculture and Forestry Ministry (MAF) is saying not to worry in advance. The ministry feels that because there is still some time left until the later maturing rice is harvested, a typhoon or a drop in the temperature may arise, which may worsen the crop and prevent prices from slumping heavily.

The government is forecasting rice prices will drop by five percent from last year and has drawn up 854.9 billion won to guarantee the minimum income for rice. In this system, the government will be supporting 85 percent of the difference in the rice price and this year’s goal price (an 80-kilogram sack of rice for 170,070 won). If the rice price falls more than expected, the guarantee payments will have to increase.

Kim Young-man (48), director of the food-grain policy bureau at MAF, said, “If the price falls drastically in early October, we will increase the public reserve stock to four million sacks.”