Since the launch of the new government, the Ministry of Agriculture, Food and Rural Affairs (Minister Chung Hwang-keun, MAFRA) has presented fundamental solutions to unresolved challenges such as securing food sovereignty and stabilizing the supply and demand of rice, agricultural and livestock produce through creative and innovative policies, including promotion of floury rice and direct payment for strategic crops.
MAFRA established a solid foundation where agriculture can further grow into an industry for future growth by presenting a vision and roadmap for nurturing young farmers, creating an innovative ecosystem for new industries such as smart agriculture, food technology, and green-bio, and expanding export of K-Food+, so that agriculture can make another leap forward as a people’s industry by going beyond production-centered and precedent-dependent skepticism and looking ahead for decades.
[Key achievements over the previous year]
Enhanced both rice supply-demand balance and food self-sufficiency rate!
In order to address food security-related vulnerabilities caused by falling rice prices due to oversupply of rice and lower self-sufficiency rates of major crops such as wheat and soybeans, MAFRA moved away from the conventional ad hoc measures and promoted the floury rice industry and the institutionalization of a direct payment system for strategic crops. By doing so, the Ministry enabled stability in rice supply and demand and increase in food self-sufficiency rate, while enhancing the predictability and reliability of the policies.
The new government has been dedicated to stabilizing rice prices since the days of the transition committee, and announced measures to purchase 900,000 tons of rice, the largest amount ever, in the 2022 harvest season, the earliest in history, making rice prices go up by 16.7% which had been declining since 2021 harvest season.
In addition to resolving the structural oversupply of rice, the new administration put forward promotion of floury rice, which can replace highly import-dependent wheat and increase the food self-sufficiency rate, as the new government’s first policy. A direct payment system for strategic crops was newly introduced and legislated, solving problems of the temporarily operated project supporting cultivation of non-rice crops in rice paddies.
The government, while building a consensus with the public and the agricultural industry, has developed these effective measures as an alternative to the “forced purchase of surplus rice,” so that the sustainable development of the food industry, including rice, can be promoted and the future of our agriculture and rural communities can be safeguarded.
Laying the groundwork for developing agriculture into an industry for future growth by creating innovative agri-food ecosystem!
MAFRA has been putting forward digital transformation of the entire agri-food value chain, including production, distribution and consumption, so that agriculture can overcome the limitations of the existing production-oriented low-tech industry. The Ministry also significantly improved the agri-food system, including policies, organizations and institutions, in an attempt to dedicatedly foster emerging industries for the future, such as green-bio and food technology.
The Ministry presented a roadmap for transforming the traditional production-oriented structure into a structure that can foster future-oriented industries converged with cutting-edge technologies such as ICT, BT, and robots by devising the 1st basic plan to nurture young farmers and a plan to develop new industries such as smart agriculture, food technology, and green-bio.
In addition to K-Food, the export industrialization of K-Food+, which encompasses both upstream and downstream industries such as smart farms and agricultural equipment applied with advanced technology, has been implemented as a key policy. As a result, export volume in 2022 reached a record high of 11.8 billion dollars (8.8 billion dollars for agri-food, 3 billion dollars for upstream and downstream industries).
In order to secure the driving force to develop agriculture into a future growth industry, a large-scale reorganization was carried out for the first time in ten years, with food security and agri-food innovation as the two key pillars. Furthermore, organizations dedicated to young farmers, smart farms, food technology, green-bio, and pets were newly established.
Structural and chronic issues have been addressed for the future of farmers, agriculture and rural areas!
In line with the new government’s emphasis on freedom and solidarity, structural and chronic issues left unaddressed on the agricultural fields were resolved through communication with people on the ground based on regulatory innovation, autonomous and social responsibility.
In responding to the global avian influenza outbreak situation last winter, unlike before, the government successfully prevented horizontal transmissions to other regions and farms by adjusting the number of animals to be culled based on risk assessments, thereby reducing the number of culled animals and stabilizing the supply and demand of eggs. As a result, while Japan (64.3%), the United States (83.5%) and Europe (70.9% in Spain) suffered a spike in egg prices, Korea maintained the average level of egg prices.
The Ministry of Agriculture, Food and Rural Affairs actively communicated with producers’ associations since the launch of the new government and reached a consensus to introduce a classified pricing system where milk is categorized and priced according to its use, which has not been implemented over the past decade, enabling that supply and demand is determined in a market, amid continued oversupply of milk and the declining competitiveness of the dairy industry.
The Ministry revised the relevant Act in order to address the situation where farmers could not receive direct payments even though they were actually farming due to the inflexible system over the last three years since the reform of the direct payment system in 2020. As a result, 300 billion won worth of additional direct payment was provided to 560,000 farmers.
In order to prevent the vicious cycle of generous diversified investment in rural areas, urban sprawl and disappearance of rural areas, the Act on the Rural Space Plan was enacted to lay the foundation for the central and local governments to devise the masterplan for rural spaces for the first time in history so that rural spaces can be systematically developed as living, resting and working spaces for people.
Plan for 100 years of food sovereignty will be established with farmers based on a solid management safety net for farms!
This year, the government plans to turn around a continuously declining food self-sufficiency rate so that it can reach 55.5% by 2027, by managing the price of rice produced in 2023 to the level of 200,000/80kg and by increasing the production of strategic crops including floury rice, wheat and bean, as promised to farmers.
This year, measures for appropriate production will be strengthened by reducing the rice production areas by 16,000 ha with the direct payment system for strategic crops. The commercialization of floury rice will be promoted by increasing the production of floury rice and by developing various floury rice products through public-private partnership (15 companies in 2023). The government plans to transform the rice-oriented production system through development and distribution of agricultural machinery and equipment tailored to production·consumption of strategic crops and expansion of public stockholding.
Management stabilization program based on real income will be introduced (in 2024) to support stable and systematic management of farms. Direct payment will increase to 3 trillion won in 2024 and 5 trillion won in 2027 by introducing·reforming direct payment systems for carbon neutrality·farming transfer.
Achievements will be made in the agricultural sector, an industry for future growth, by strengthening the innovative ecosystem.
30,000 young farmers will be nurtured by 2027 and not only greenhouse horticulture but also agricultural, livestock and fruit farming will go smart in cooperation with ICT companies, while promoting digitalization of distribution by launching online wholesale markets. The agri-food fund will reach 200 billion won within this year and 1 trillion won by 2027 to increase private investment in new industries including industries related to food technology, green-bio and pets.
With the K-Food+ export expansion headquarters, the government will boost export led by the private sector so that exports can go upward within the first half of this year and reach 13.5 and 23 billion dollars in 2023 and 2027, respectively. MAFRA also plans to expand the agricultural official development assistance (ODA) with the establishment of the K-Rice Belt in 7 African countries this year, aiming to raise the national status of Korea in the international community.
Looking back, Minister Chung Hwang-keun said, “The first year of the newly launched administration laid the foundation for agriculture to leap forward by addressing accumulated challenges including global supply chain disruptions.” The Minister expressed his commitment by saying, “Bearing the mindset the new administration started with in mind, we will make every effort to deliver tangible outcomes for people and farmers.”