This study evaluates the current state of the government Grain Purchasing System, with an aim to present progressive policy direction for the system.
Since the foundation of South Korea, until the early 1980s, growing more grain for self-sufficiency was a crucial economic policy objective. The government had made efforts to increase productivity per land unit through arable land cultivation, readjustment of arable land, seed renovations, and blight prevention. In addition, since 1970s, the government adopted a rice pricing system as a means to augment income for farming households. Rice prices began to fluctuate because of poor harvests or increased production by the adoption of the high-yield varieties, and the government revised the Grain Management Act as mandatory to win an approval from the National Assembly on the grain supply plan, the volume of purchasing quota, and prices. Also, the Grain Distribution Committee was established to recommend a suitable purchase quota and prices.
The purchasing quota has been increasing since 1989 and is expected to increase further, as rice consumption per capita continues to decrease because staple foods has been diversified and consumption of alternative foods, such as fruit, increases. However, the government grain purchase system, which was adopted to stabilize grain prices, has been largely ineffective in augmenting income for farmers, while imposing a substantial financial burden on the government. In addition, government intervention in the grain market misused distribution of the private sector, as well as delayed the structural reform of the agriculture.
Therefore, if the government wants to implement an effective purchasing program, it needs to separate the farmer income reinforcement from the system. Also, as the current National Assembly approval system in increasing the purchasing price often leads to delayed decision making, there should be efforts to make the process more efficient. As for compensating the farming households, there should be measures taken to prevent it from undermining the structural reform of the agriculture.
추곡수매제도의 문제점과 개선방향(Challenges and solutions of the grain purchasing system)
|Series Title; No||정책연구시리즈 / 91-42|
|Subject Country||South Korea(Asia and Pacific)|
|Subject||Industry and Technology < Agriculture|
|Holding||KDI; KDI School|