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Kimchi Crisis and Gov’t Policy

Posted October. 01, 2010 12:28,   


It was a bumper year for both vegetables and fruit in 2008 because of good weather. Consumers were happy because they could buy produce at bargain prices, but farmers, who saw the price of Chinese cabbage and white radish plummet, gave up harvesting them and plowed up the land. The farming of Chinese cabbage was good last year as well, so South Jeolla Province, the country’s largest supplier of Chinese cabbage for kimchi production, cut output, and promoted kimchi consumption. Farmers were not happy, however, because they could not get their desired price in a bumper year.

Things have drastically changed this year, however, The price of Chinese cabbage has tripled or quadrupled this year from last year, and restaurants rarely serve kimchi to their customers. This is because of the Chinese cabbage shortage, which las fueled fears of a kimchi crisis. The government began a crackdown under the suspicion that merchants are hoarding cabbage but the bigger reason is a significant production drop. Korea Rural Economic Institute said, “Production was cut more than 50 percent due to high temperatures and excessive rainfall in the high area of Gangwon Province. Production in Gyeonggi and the Chungcheong provinces also decreased due to Typhoon Kompasu.” Both farmers and merchants are as unhappy as housewives because they have no products despite the rise in prices.

The main opposition Democratic Party has blamed soaring vegetable prices on the four-river restoration project. Spokeswoman Jeon Hyun-heui said, “It is also due to erratic weather patterns but the four-river restoration project has cut 16 percent of the area for facilities (greenhouses). The skyrocketing prices of vegetables had already been predicted.” In response, the Food, Agriculture, Forestry and Fisheries Ministry said the area that has disappeared due to the river project is 3,662 hectares, or just 1.4 percent of 262,995 hectares in Korea as of July last year. In other words, the area is not large enough to impact vegetable prices. It is difficult to know, however, which side is right based on what they claim. Analysis of the specific production amount on areas near the four rivers is needed to find the cause for the price hike.

Since agricultural prices are extremely sensitive to supply and demand, they soar or plummet if a slight shortage or glut of the products ensues. A vicious cycle is likely to be repeated if farmers plow up the land because of excessive production and if the area for production drops next year, causing inflation. If this price increase is a once-in-a-century crisis due to erratic weather patterns, it is hard to blame the Food Ministry. Yet the government deserves much of the blame that it is lazy because the ministry decided to import Chinese cabbage from China only after production was halved this year and the price of kimchi soared.

Editorial Writer Park Yeong-kyun (parkyk@donga.com)