[Asia Economy Sejong=Reporter Kim Hyewon] The government plans to purchase 450,000 tons of public stockpiled rice during this year's harvest season and additionally buy 450,000 tons of rice to isolate it from the market in order to prevent a sharp drop in rice prices.
The Ministry of Agriculture, Food and Rural Affairs announced on the 3rd that it had prepared the "Harvest Season Rice Supply Stabilization Measures" after consultations with the Grain Supply and Demand Stabilization Committee on the 27th of last month.
According to the crop condition survey by the Rural Development Administration, this year's rice crop is better than average and similar to last year. Considering the decreasing trend in rice consumption, an oversupply is expected. However, since production may change depending on weather conditions until the full harvest season, this year's rice production volume will be finalized based on the Statistics Korea's rice production announcement on November 15.
To stabilize the rice market during the harvest season, the Ministry of Agriculture, Food and Rural Affairs decided to purchase and isolate 450,000 tons of rice, combining old and new rice. This was announced through a ruling-party-government meeting on the 25th of last month and is the largest market isolation volume since the introduction of the public stockpiling system in 2005. The ministry expects that approximately 1 trillion won will be temporarily required for this purchase based on past cases.
Separately from the market isolation volume, the government plans to purchase 450,000 tons of public stockpiled rice during the harvest season and support 3.3 trillion won in purchase funds to local distribution companies to stably buy farmers' shipment volumes. This is an increase of 100,000 tons compared to last year.
The total 900,000 tons isolated from the market accounts for 23.3% of this year's expected rice production. The proportion of rice isolated from the market during the harvest season has been between 8.3% and 18.1% in normal years.
The Ministry of Agriculture, Food and Rural Affairs plans to additionally decide whether to purchase unprocessed rice at an appropriate time after conducting demand surveys. Unprocessed rice refers to public stockpiled rice purchased through local distribution companies in a non-dried state.
To minimize damage to farmers caused by typhoons and prevent deterioration of rice quality in the market, the government will purchase all desired quantities of damaged rice from farmers.
To establish order in rice distribution during the harvest season, the ministry will crack down on mixing domestic and imported rice, as well as rice from different production years, during November and December, and conduct inspections on the distribution and management of government grain stocks.
The Ministry of Agriculture, Food and Rural Affairs will prepare additional supply stabilization measures if necessary after Statistics Korea finalizes this year's rice production volume on the 15th of next month.
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