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Shoppers examine bags of rice at a large supermarket in Seoul on Oct. 12 as rice prices continue to surge. [NEWS1]

The Korean government plans to remove 100,000 tons of rice from the market this year to stabilize prices, as reduced consumption and growing processed rice demand contribute to a projected production surplus. 

The Ministry of Agriculture, Food and Rural Affairs announced the decision on Monday following a meeting of the Grains Supply Committee, where it finalized its 2025 rice supply management plan.

Government data projects the total rice output for this year at 3.574 million tons, down 11,000 tons or 0.3 percent from last year. But expected consumption is lower at 3.409 million tons due to a steady decline in table rice demand and an increase in processed rice use. The resulting surplus is estimated at 165,000 tons. 

Although the total rice cultivation area fell by 2.9 percent compared to last year, favorable weather conditions led to a 2.7 percent increase in yield per unit area, reaching 527 kilograms (1,161 pounds) per 10 acres. The committee also took into account the possibility of reduced actual output due to lower sunlight and the spread of crop diseases, as well as low private stock levels.

The government plans to isolate 100,000 tons from the market. Of that, 55,000 tons will be retrieved from rice previously supplied to local distributors through government loans. The remaining 45,000 tons will be designated for industrial use to keep it out of the table rice market. 

In comparison, the government isolated 260,000 tons of rice last year despite a much smaller surplus of 56,000 tons. In 2021, the government delayed its market intervention even after a surplus of 270,000 tons, triggering a sharp drop in rice prices.

Shoppers examine bags of rice at a large supermarket in Seoul on Oct. 12 as rice prices continue to surge. [NEWS1] 

Retail rice prices remain high. The average retail price for a 20-kilogram bag stands at 66,972 won ($47), up 25.8 percent from the same period last year.  

The Agriculture Ministry expects farmgate prices to stabilize from mid-October when newly harvested rice begins reaching the market. Consumer prices are also projected to gradually decline.

To ease the financial burden on households, the government will extend its rice discount program through the end of October and increase the discount from 5,000 won to 7,000 won per 20-kilogram bag.

The committee also discussed the potential for increasing rice exports to Japan in response to soaring prices in that country. The Agriculture Ministry said it would consider additional policy support to facilitate such efforts.

“While we are expecting a surplus again this year, we have decided to isolate 100,000 tons first, given the possibility of changes in actual production,” Agriculture Vice Minister Kang Hyoung-seok said. “We will continue monitoring the market closely after the harvest to help stabilize rice prices.”

Source : msn