The purpose of this study is to derive rice marketing strategies of agricultural cooperatives according to the changing environment of the grain markets and the domestic rice market opening. The main contents in this study review what are effects of the import expansion on the rice supply and demand and expect how the governmental policy and marketing environment of rice will be changed in the future. We derive the problems in the rice marketing of the agricultural cooperatives by analyzing the performance of the rice selling business. Finally, we develop marketing models and suggest direction and strategies of the agricultural cooperatives for expanding rice sales. This study proposes a centeralized RPC model and joint marketing model as the agricultural cooperatives' marketing models for promoting rice sales.
The rice policy of the government is expected to change to a public reserve system to ensure the long-term stability of the rice industry. The government will play more role in the food security, functionality of agriculture, consumer protection and agricultural income stabilizaion policy. Thus, the grain policy of the government is expected to be changed the current rice purchasing system premised on the initiation of the public reserve system. Also, the government will try to enlarge the rice cultivated land per household, to foster the superior varieties representing regions for the sake of supplying high quality rice, to install the rice inspection system such as labels and packages. The RPC will be fostered to produce and distribute high quality rice.
The volume of rice conducted by the agricultural cooperatives accounts for 45%, and 58% out of the total marketing quantity and the consumtion areas' quantity in 2003, respectively. However, the competitiveness of agricultural cooperatives is low compared to the private sector in terms of the price because of high purchasing price during the harvest and the excessive fixed costs. Along with this, the numbers of large distributors in the urban areas are dramatically increasing and are leading the rice market in terms of the price. The amount of rice sold through distribution channel of agricultural cooperatives in 2003 reached around 2 trillion Won, but most have small sales outlets.
A grain marketing cooperation sold rice about 316.9 billion Won, but it's net loss was 400 million Won in 2003. The marketing organization of agricultural cooperatives should understand the behavior of the large grain distributors in the urban areas and cope with the changes in tastes and patterns of consumers. In light of that, the rice marketing cooperatives need a marketing strategy that can expand the sales of rice responding to the new marketing environment.
The management structure of agricultural cooperative's RPC in the rice producing areas, except Gyeonggi, Kangwon, Kyeongnam, and Kyeongbuk province, turned out to be recorded losses. Large PRCs with more than 12 billion Won in sales generated net profit, but by contrast small and medium-sized ones recorded losses. It leads to draw a conclusion that the agricultural cooperative' RPC must be adjusted to a appropriate scale. This study suggested the centeralized RPC model as a long-term project in response to the changing rice marketing environment. Also, the role of the local self-autonomous organization will be strengthened to perform actively the project to specialize the region's rice, the local agricultural cooperatives must serve as the decision-making body, and the RPC must focus on the sale promotion as the responsible company.