Rice Prices Surpass 210,000 Won... Government Releases 30,000 Tons of Reserve Rice

Local distribution companies must sell on the market by the end of September
Return with 2025 new crop by March next year
Ministry of Agriculture and Food: "Responding to this year's supply shortage and reducing next year's production"

The government has decided to supply 30,000 tons of rice to local distribution companies in an effort to stabilize rice prices, which have recently exceeded 210,000 won per 80kg due to a supply shortage. The companies receiving rice from the government must sell the supplied rice on the market by the end of next month.

The Ministry of Agriculture, Food and Rural Affairs announced on August 11 that it will supply 30,000 tons of government-held rice (paddy) by the end of this month.

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According to Statistics Korea, as of August 5, the farmgate price of rice was 52,900 won per 20kg, which translates to 211,600 won per 80kg, surpassing the 210,000 won mark.

The supply volume is 30,000 tons based on milled rice. This amount corresponds to the level of stock that is expected to be insufficient at the end of the grain year. The supply targets are local distribution companies that are eligible for government paddy purchase support in 2024, as well as rice milling companies that purchase at least 3,000 tons of paddy annually.

An official from the Ministry of Agriculture, Food and Rural Affairs explained, "Unlike the existing public auction method, this government rice supply will be provided as a loan, meaning the same amount must be returned in 2025 rice," and added, "This is intended to resolve on-site difficulties for local distribution companies facing a shortage of raw rice, while also minimizing the impact on supply and demand during the upcoming harvest season."

Companies eligible for the government rice supply and wishing to receive it must submit their desired quantity by August 14, according to the announcement on the NongHyup Agribusiness Group website. The allocation will be determined based on each company's share of rice sales in the previous year. Companies allocated rice must collect their assigned volume from designated government rice storage warehouses by August 29.

The government rice supplied this time must not be resold as paddy and must be sold as rice by the end of September. The Ministry of Agriculture, Food and Rural Affairs will supervise the completion of sales and continue crackdowns on the distribution of mixed old and new rice.

Companies that receive government rice must return an equivalent amount of 2025 new crop rice to government warehouses by March 2026. The quantity to be returned will be determined later, taking into account the average farmgate rice price in July 2025, the 2025 harvest season rice price, and milling yield rates.

Byun Sangmoon, Director of Food Policy at the Ministry of Agriculture, Food and Rural Affairs, stated, "Since the supply of 30,000 tons this time will have the effect of reducing the 2025 crop production by the same amount, it is expected to help stabilize rice prices during the 2025 harvest season," and added, "The government will do its best to maintain stable rice prices for the benefit of both farmers and consumers."