[The Economics of Heatwaves⑥] Lettuce Withers, Cattle and Pigs Refuse Feed... Heatwaves Fueling Inflation

[Asia Economy Sejong=Reporter Kim Hyewon] #. Mr. Kim Byung-ryul, a farmer in his 60s who cultivates leafy vegetables and fruits in Namwon, Jeollanam-do, recalled the nightmare of 2018 due to this year’s relentless heatwave. The record-breaking scorching heat completely ruined the crops, leaving nothing to sell. At that time, the number of heatwave days was 35, the longest and hottest in nearly a decade. Although this year’s situation is somewhat less severe, it is by no means better. Heatwaves have now become a daily reality. Mr. Kim lamented, “This year, the spring drought combined with the summer heatwave has ruined the crop yield. Heat-sensitive lettuce was scorched, peppers dried up and died, and corn suffered damage during its growth stage.” He also reported that the market value of peaches has plummeted, causing a surplus sale of B-grade peaches, while the scarce A-grade peaches have skyrocketed in price. Supplying to Nonghyup Hanaro Mart, Mr. Kim said, “Due to the severe shortage in production, prices of most leafy vegetables and fruits have increased two to three times.” ‘The Economics of Heatwaves’

The drought followed by heatwaves is once again driving up ‘table prices.’ Reduced productivity caused by abnormal climate threatens farmers’ livelihoods, and chronic supply-demand imbalances have become a constant factor pushing prices higher.

According to the Korea Agro-Fisheries & Food Trade Corporation (aT) on the 29th, as of the 25th, the wholesale price of red leaf lettuce (4kg) was 42,160 KRW, a 40.7% increase compared to the average price (29,961 KRW). Among specialty crops, oyster mushrooms (2kg) surged 147% to 17,975 KRW from 7,274 KRW a year ago. Pork prices are hovering between 5,000 and 6,000 KRW per kg, higher than usual.

The sharp rise in agricultural and livestock product prices is primarily due to soaring feed costs caused by the grain crisis triggered by the Russia-Ukraine conflict. Although the government has provided feed cost support, the common consensus on the ground is that production costs remain difficult to bear. On top of this, the severe spring drought followed by heatwaves has caused additional damage.

Among food crops, potatoes faced the worst hot and humid conditions in early July’s early heatwave with occasional rain. This led to an unavoidable increase in disease outbreaks, doubling prices at minimum. Sesame and peanuts also suffered various pests and diseases due to prolonged high temperatures and moisture deficiency. Vegetables exposed to strong sunlight experience weakened root function, causing ‘tip burn’ where leaf edges rot or dry out.

Livestock farming is equally challenging. Heat stress causes cattle, pigs, and chickens to refuse feed and reduces digestion efficiency, leading to poor growth. This results in decreased milk production and egg-laying rates, driving price increases. In extreme heatwaves, reproductive disorders and heatstroke often cause livestock deaths. Mr. Lee Mansong, a livestock farmer in Iksan, Jeollabuk-do, said, “We barely manage to force-feed supplements with the feed. Even spraying water on the roof frequently to maintain proper heat index inside the barn is insufficient.”

As of July 27 this year, the number of heatwave days (days with a maximum temperature of 33℃ or higher) totaled 7, ranking around 9th in the past decade, but when August statistics are combined, it is likely to approach the levels of 2018 (35 days), 2016 (24 days), or 2021 (18 days). According to the Rural Development Administration, the probability that the average temperature during this summer (July-August) will be higher than usual is 50%. The average number of heatwave days from 2012 to 2021 was 14.6 days, showing a steady increase by decade. The start date of heatwaves has also been getting earlier: July 11 in the 1990s, July 7 in the 2000s, and July 2 in the 2010s. The summer period itself has lengthened by 19 days over the past 30 years to 117 days, compared to 98 days in the previous 30 years.

Park Seung-moo, head of the Agricultural Meteorology and Environment Team at the Rural Development Administration, said, “By the mid and late 21st century, South Korea’s annual average temperature is expected to rise by 2.9 to 6.3℃ under a high-carbon scenario and by 1.6 to 2.3℃ under a low-carbon scenario compared to current levels.” He added, “Abnormal global climate is causing significant damage to crops in terms of both quantity and quality.” The Hyundai Research Institute has released a report stating that heatwaves directly affect summer food prices and cause ripple effects on autumn prices such as during Chuseok. Citing Statistics Korea data, the report noted that the inflation rate in July-August during years with prolonged heatwaves was 0.6 percentage points higher than the annual average inflation rate, and especially for agricultural, livestock, and fishery products, it was 3.8 percentage points higher than average.

There are also ‘smart’ farms that cultivate leafy vegetables like lettuce year-round despite the heatwaves. On the 25th, at the Smart Farm Innovation Valley in Gimje, Jeollabuk-do, Greenbyte CEO Ryu Heekyung explained, “Crops are living organisms with biological rhythms, and abnormal climate disrupts the ecosystem. In our case, we use hydroponics to maintain the greenhouse’s maximum temperature between 32 and 34 degrees Celsius, growing lettuce in 5.5-week cycles and supplying it to intermediate distributors.” CEO Ryu added, “As the number of smart farms increases, we can ultimately expect market price stabilization. Like the agricultural powerhouse Netherlands, South Korea must transition to smart farming, but there is still a long way to go.” The smart farm complex under Gimje City’s jurisdiction consists of 10 units, including a multi-purpose building cultivating low-temperature crops such as leafy vegetables and strawberries, and a fruit and vegetable building growing paprika, tomatoes, and cucumbers.