South Korea Agribusiness Q2 2010

Date: February 1, 2010
Pages: 59
Price:
US$ 1,295.00
Publisher: Business Monitor International
Report type: Strategic Report
Delivery: E-mail Delivery (PDF)
ID: S21C5BE6B79EN
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The new year started badly for South Korea's agribusiness sector. On January 2 foot and mouth disease (FMD) was found in cattle on a dairy farm in Gyeonggi-do. The government destroyed all the animals on the infected farm and tightened quarantine rules to try and prevent the spread of the disease. Despite this, the initial outbreak was followed by four further outbreaks in the middle of the month. These are the first outbreaks of the disease since 2002. The two previous outbreaks in 2000 and 2002 cost the industry KRW300bn (US$261mn) and KRW150bn respectively. With the experience gained from the previous outbreaks, the government should be able to bring the current outbreak under control more quickly and we do not see the economic cost being as high this time around.

The FMD outbreak followed hot on the heals of the appearance of H1N1 swine flu on farms in the country. The disease first appeared in December and by late January, 18 outbreaks had been reported, the majority in North and South Gyeongsang provinces. This saw the price of pork briefly fall as wary consumers avoided the meat, despite assurances of its safety. Further worries were caused by the discovery of low pathogenic avian flu in wild ducks in December.

Away from livestock, the Korean government is still struggling to formulate policy to deal with a surplus of rice supplies. In 2009/10, Korea will bring in another bumper crop of the grain - we have revised up our forecast to 4.91mn tonnes in response to a data release by Statistics Korea. With domestic demand on a long-term declining trend and Korean rice too expensive for large scale exports, the government is struggling to support prices in the face of the abundant stocks.

With this in mind, there was news of a large increase in demand for Makgeolli, traditional Korean rice wine. In the first 10 months of 2009, production was up 37.8% according to a Statistics Korea report. The government is trying to promote an increase in the use of rice in food processing to create extra demand for the crop.

The government has also recently stepped up purchases of agricultural land to make it easier for Korea's farmers, the vast majority of whom are well into retirement age, to leave the sector. The government of President Lee Myung-Bak is hoping to make the sector more commercial, moving away from the traditional model of inefficient smallholder farmers propped up by government subsidies. Reforms to the cosseted agricultural sector are always controversial. In the long term, however, reform is desperately needed as the cost of subsidies rises and few younger people who could serve in reforming production are drawn to the sector.
Executive Summary
SWOT Analysis
South Korea Agricultural SWOT
Industry Forecast Scenario
South Korea Rice Outlook
    Table: South Korea Rice Production, Consumption & Trade
    Table: South Korea Rice Production, Consumption & Trade
South Korea Grains Outlook
    Table: South Korea Wheat Production, Consumption & Trade
    Table: South Korea Corn Production, Consumption & Trade
    Table: South Korea Wheat Production, Consumption & Trade
    Table: South Korea Corn Production, Consumption & Trade
South Korea Dairy Outlook
    Table: South Korea Milk Production & Consumption
    Table: South Korea Butter Production & Consumption
    Table: South Korea Cheese Production, Consumption & Trade
    Table: South Korea Whole Milk Powder Production, Consumption & Trade
    Table: South Korea Milk Production & Consumption
    Table: South Korea Butter Production, Consumption & Trade
    Table: South Korea Cheese Production, Consumption & Trade
    Table: South Korea Whole Milk Powder Production, Consumption & Trade
South Korea Livestock Outlook
    Table: South Korea Poultry Production, Consumption & Trade
    Table: South Korea Pork Production, Consumption & Trade
    Table: South Korea Beef & Veal Production, Consumption & Trade
    Table: South Korea Poultry Production, Consumption & Trade
    Table: South Korea Pork Production, Consumption & Trade
    Table: South Korea Beef & Veal Production, Consumption & Trade
Industry Business Environment Overview
Global Agribusiness Business Environment Ratings
Global Agribusiness Business Environment Ratings
Competitive Landscape
    Table: Agricultural Commodity Producers & Traders
    Table: Agribusiness Suppliers
    Table: Integrated Agricultural Producers
Commodity Price Analysis
Grains Update
Corn
    Table: Corn
Rice
    Table: Rice
Soy
    Table: Soybean
Wheat
    Table: Wheat
Softs Update
Cocoa
    Table: Cocoa
Coffee
    Table: Coffee
Milk
    Table: Milk
Sugar
    Table: Sugar
Downstream Supply Chain Analysis
Industry Forecast Scenario – Food
Food Consumption
    Table: Food Consumption Indicators - Historical Data & Forecasts
Canned Food
    Table: Value/Volume Sales of Selected Food Sub-Sectors -- Historical Data & Forecasts
Confectionery
Trade
South Korea Food & Drink Trade Indicators -- Historical Data & Forecasts (US$mn)
Industry Forecast Scenario – Retail
Industry Forecast Scenario – Retail
    Table: South Korea MGR Indicators -- Sales Value by Format -- Historical Data & Forecasts
Grocery Retail Sales by Format - Historical Data & Forecasts
Macroeconomic Forecast
South Korea - GDP By Expenditure, % of GDP
BMI Forecast Modelling
How We Generate Our Industry Forecasts

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