Stabilize the rural economy and enhance its inclusiveness
◇ Business operation cost increased due to supply chain reorganization and COVID-19. Climate change increased disaster risks.
* Farm Input Prices Index Paid by Farmers for the third quarter of 2021 (100 in 2015): Total index 112.5 (from the same period of the previous year, 5.5%↑)
Material cost 113.7 (10.5), farming material cost 122.4 (19.3), labor cost 138.3 (10.9), etc.
ㅇ To ensure steady farm-household income and revitalize people’s livelihood and the economy, supply and demand management for agricultural products is highlighted as an important task as it became more volatile.
◇ It is necessary to secure and strengthen social safety net to alleviate the nutritional imbalances by class* and the quality of life for the vulnerable in rural areas, which have worsened since COVID-19.
* After COVID-19, 29.9% of the vulnerable groups consumed less fruits and processed food. 24.3% consumed less vegetables. (KREI, 2020)
1. Stabilize farm business conditions
(Stabilize farm business conditions ) To support farms for stable business management by strengthening preparation for management risks caused by rural labor shortage and disasters
(Secure stable labor supply) To increase inflow of domestic workers such as urban job seekers and utilize more foreign workers in the short term ,and to reduce labor demand by through mechanization for field crops
To encourage urban workers to move to rural areas by expanding Rural Manpower Brokerage Centers (130 in 2021 → 155 in 2022) and building a platform for recruiting urban and rural workers
To pilot a seasonal worker program* and allow seasonal work in agriculture for foreigners residing in Korea, which was temporarily permitted until March 2022 * Local authorities (NongHyup) hire foreign seasonal workers and send them to farms as short-term workforce
To implement a pilot program of 'Mechanization’ (in 4 sites) through the entire process of garlic and onion cultivation (sowing, planting, harvesting, etc.) where labor demand is concentrated during peak season
(Credit Guarantee) To enhance credit guarantee for farmers through contribution from Agriculture, Forestry and Fisheries Credit Guarantee Fund (130 billion won) and elevated limit of special guarantee (Currently, 300 million won in maximum, discussed by the Financial Services Commission)
To extend implementation of lower interest rate spread (2.0~2.5% → 1.5%) in order for farmers to overcome damage caused by COVID-19 and support household stability
(Disaster response) To improve disaster preparedness through institutional improvement such as sophisticated insurance premium rate calculation units for crop accident insurance*( Si/Gun → Eup/Myeon, to pilot it for apples and pears from January) * Calculate reasonable insurance premiums according to the level of disaster risk by each farm → Strengthen stability of insurance coverage
To consider disaster risks caused by climate change, and to review the expansion of insured items (2nd quarter)
2. Promote stable economic recovery
(Balance the supply and demand) To build an agricultural observation system with high accuracy based on data and establish the self-balancing of supply and demand controlled by producers based on observation information
(Enhance accuracy of observation) To collect accumulated data of observation, introduce cross-validation system*, and continue to open data to the private sector in order to refine predictive models * Cross-validate findings using drones, the reported size of cultivation (by check-off fund organizations and observation results
To sophisticate supply and demand forecasting model for livestock products* by adding consumption information to existing observation and to forecast the mid- to long-term outlook** for the livestock industry by using market information (Raw materials, exchange rates, etc.) * Supplement the analysis of changes in demand for livestock products by analyzing purchase patterns of the consumer panel (3,000 people) ** Provide securities companies with information such as wholesale market bid information, meridian price, and number of the slaughtered, and compare previous forecasts and analysis for supply and demand and supplement results by conducting analysis through advanced financial techniques (every month after January 2022)
(Enhance effectiveness of check-off funds) To increase the number of mandatory items for check-off funds (23 in 2021 to 26 in 2022), encourage reporting of cultivation*, and improve evaluation system in order to reinforce supply and demand control * Encourage cultivation reporting through representatives of producers and provide preferential support for agricultural equipment and materials to farmers who report cultivation
(Streamline supply and demand control) To increase the amount of vegetables to stabilize prices (17% of production → 20) and expand storage facilities to respond to sudden short-term supply change* * Number of facilities to control supply of vegetables (cumulative): 2 sites in 2021 → 5 in 2022
(Improve distribution system of eggs) To improve the pricing structure so that the market price is formed and announced by starting auctions at two public markets (wholesale market, Pocheon Livestock Cooperative and Haemil) (from the end of 2021) * Currently, egg prices are determined after the farm and the egg distributors negotiate prices one-on-one based on prices announced by the Poultry Association through its own investigation and then settle the price according to the actual selling price.
(Reinforce food security) To continue to expand the basis for self-sufficiency of wheat and soybeans and strengthen management of monitoring imported grains and equipment and the production resources
(Wheat) To expand the domestic wheat market and sales channels by easing the burden of domestic wheat processing cost** in line with expansion of the production base* and signing MOUs between processing companies and producer groups * Wheat production complex (sites, cumulative): 39 in 2021 → 51 in 2022 / Wheat equipment (sites, cumulative): 2 in 2021 → 16 in 2022 / Contract farming of wheat (1,000 tons, cumulative): 4 in 2021 → 6 in 2022 / Supply species (tons): 1,389 in 2021 → 1,900 in 2022 ** Partial support for milling and distribution costs to processing companies that use more domestic wheat compared to the previous year
(Soybean) To revitalize large-scale non-bean cultivation complexes by implementing new programs (in March) such as drainage improvement of non-bean complexes (3 locations) and support for joint sorting costs (20,000 tons) * Production complex of beans raised in a field (sites, cumulative): 83 in 2021 → 120 in 2022 / Soybean processing (sites, cumulative): 12 in 2021 → 16 in 2022 / contract farming of beans (1,000 tons, cumulative) : 10 in 2021 → 20 in 2022
(Crisis response) To expand food stockpiles* such as purchasing public rice reserve (350,000 tons → 450,000 tons), strengthen monitoring of key items in supply chain management, and diversify import sources * Domestic wheat/soybean purchases (1,000 tons): 10/25 in 2021 → 14/25 in 2022
To alleviate the burden on the industry by extending the period of applying tariff quota to edible corns (end of 2021 → 2022)
To diversify import sources (management of less than 50% of the proportion of specific countries) in order to secure raw materials for fertilizer in an early stage, and ensure price bargaining power through joint purchase of raw materials* * To avoid price increase due to excessive competition among businesses and reduce transportation costs by purchasing in bulk
To expand financial support for the purchase of inorganic fertilizers (KRW 200 billion → 6,000, 3% → 0) and relieve the burden on fertilizer companies and farms by supplying 80% discount of fertilizer price increase
(Secure farmland) To reinforce the review system for large-scale farmland conversion (Farmland Management Committee is newly established in May) and prepare measures to secure appropriate farmland in consideration of achieving food self-sufficiency (2022)
3. Reinforce food and rural inclusiveness
(reinforce support for food) To increase the number of beneficiaries* of the pilot project to support food for the underprivileged, and build a clearer plan for starting the project officially and prepare budgets
* Agri-food vouchers targets not just county/provincial-rural complex cities but large cities. Pregnant women care packages expand the target from 11 to 16 cities (Fruit snacks support 240,000 students at daycare classes of elementary schools)
To provide agri-food consumption coupons to alleviate consumer burden (approximately 3.8 million, 10,000 won/person)
(Reinforce social safety net in rural areas) To reinforce social safety net such as livelihood and medical care for the vulnerable in rural society such as elderly farmers, female farmers, and foreign workers
(Farmland pension) To lower the eligible age for pension subscription (from 65 to 60 years old), introduce preferential products for low-income farmers (vulnerable groups) and long-term farmers over 30 years (additional 5-10% of monthly payment) (1st quarter)
(Medical care) To conduct special health checkups for female farmers on musculoskeletal diseases caused by agricultural work and respiratory diseases caused by dust and pesticides (9,000 people)
To bolster support for health insurance premiums for farmers (28% of self-pay insurance premiums) including foreigners who have been engaged in agriculture for more than 90 days a year meeting requirements as a farmer
(Safety of farmers) To transform safety insurance for farmers, which was previously paid only as a lump sum, by allowing disability benefits and survivors’ benefits to be paid in the form of annuity, (from October)
(Solidify foundation for urban-rural synergy) To diversify the local food model of local production and consumption into a urban-rural synergy model that links rural cities and counties with urban cities
To increase the number of ‘direct stores for urban-rural synergy’ that directly supply agricultural products produced by farmers to direct stores (cumulative, ‘21: 2 places in 2021 → ‘22: 5 in 2022) in urban cities (over 300,000 of population)
To spread the local food supply system that uses locally-produced agi-food in urban-rural cities or guns nearby with a focus on meal catering in government agencies in large cities * Regional food supply system (cumulative): 1 place in 2021 (Daejeon + Gongju, Cheongyang, Yuseong-gu) → 3 places in 2022