Research Reports
A Study on Stabilization of Supply and Demand through Producing District Systematization of Carrots: A Self-regulating System
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AuthorChoi, Byungok
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Publication Date2015.12.18
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Original
The Government has prosecuted supply and demand and price stabilization for Chinese cabbage, radishes, chilli peppers, garlic, onions which show a big price fluctuation and affect the life of the people much. However, carrots have not been included in the benefit due to a small production scale. Particularly, supply and demand of winter carrots are unstable owing to the change of climate. The production infrastructure of winter carrots has declined consistently as processed food products imported from China and Vietnam are increasing. Therefore, against this backdrop, this study aims to present a self-regulating supply and demand stabilization method through the systematization of major producing areas for the sustainable growth of winter carrots.
This research identifies problems in creating an autonomous system for stabilizing supply and demand for Jeju Province's winter carrots, estimates the cultivation acreage optimum for demand, and draws ways to maintain and develop the system.
Winter carrots in Jeju-do have shown continuous price fluctuations, and a fall in their self-sufficiency rate and meteorological changes have influenced a rise in imports. Nevertheless, the government has not developed an organizational system for supply and demand stabilization, including identifying alternative crops and seeking new markets, and cohesion among organizations is also low. As a result, the implementation of the project by each individual actor has led to a low function of supply and demand control.
Before establishing the self-regulating system for stable supply and demand for carrots, we set various market prices and standard prices in estimating the optimum cultivation acreage that reflects changes in domestic and foreign conditions. We set last year's market price and the market price in an average year as market prices; and production costs, the average-year price, production cost+profit (10%) as standard prices (prices received by producers).
When the market price was last year's, the cultivation area for reaching the standard price was 1,263-1,343ha; in the case of the average-year market price, 1,441-1,497ha.
In order to maintain stable incomes by securing the optimum cultivation acreage linked with the outlook results, first, it is needed to build the self-regulating system for the carrot supply and demand stabilization project. As a prior measure for this, it is necessary to found a supply and demand control committee, led by the Jeju provincial government and comprised of producer organizations, academia, consumer groups, and food suppliers. And when over- or undersupply is forecast, a meeting of the committee should be held to discuss effective plans. Also, contract cultivation needs to be promoted by establishing a system for organizing producers and producer groups. In addition, it is necessary to found a self-help funding group and induce producers to finance and accumulate funds for cultivating markets in response to market opening, promoting consumption, PR, etc. An ex post measure is to systematically improve the processing business in order to effectively respond to a short-term market failure.
Researchers: Choi Byungok, Lym Hyobin, Choe Jinyong
Research period: 2015. 7. ∼ 2015. 9.
E-mail address: bochoi@krei.re.kr
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