Agricultural Outlook Forum 2008 Held for “Making a New Leap Forward for Korean Agriculture and Rural Community”




The Agricultural Outlook and Information Center of Korea Rural Economic Institute (KREI) held this year’s agricultural outlook forum on January 23 at Hotel Lotte in Jamsil, Seoul. More than 1,700 participants took part in the forum to discuss current issues of Korean agriculture and its future outlook under the theme of “Making a New Leap Forward for Korean Agriculture and Rural Community.”

The forum was held in three sessions. The first session was held under the theme of “new opportunity for making a leap forward and change,” and the second and third sessions were held under the themes of “overcoming the high tide of market opening” and “major issues and market outlook by industrial sector.” In the second session, a total of sixteen speeches were delivered; and in the third session, market forecasts on major agricultural and forest products were made.

In opening remarks delivered at the forum, Choi Jung-Sup, president of KREI, said that the prices of crops and oil in the world market are forecast to continue increasing, and this rise in the prices will become a substantial burden on Korean agriculture. Moreover, he said that a lowered trade barrier can further aggravate the difficult situation of Korean agriculture. Even so, he said that new opportunities can be made available and results made different depending on how well the nation willingly copes with the situation.

In a keynote presentation addressed at the opening session, Park Dong-Gyu, director of the Agricultural Outlook and Information Center, made forecasts on this year’s economic outlook for Korean agriculture and farm households. According to him, the value added in agriculture for this year will fall by 2.6% from last year along with a decrease in the number of farm households. However, he said that farm income is projected to grow by 4% from last year due to an increase in transfer incomes such as direct payments.

The second session was held in four sub-sessions under the following themes: the trend and outlook for international trade, customer-oriented production and distribution, new engine of growth, and rural community welfare. In a presentation titled “the trend and outlook for the world crop market,” Kim Yong-Taek, a senior research at KREI, said that because of a surge in the demand for biofuels and a rising demand for food and feed grains centering around developing countries, the international standard prices of wheat, corn, and soybean in the period from September 2007 to August 2008 are forecast to increase by 46%, 14%, and 7% respectively.

In a presentation titled “The Trend and Outlook for FTA and DDA,” KREI researcher Lim Song-Soo projected that free trade agreements will be signed this year with the European Union and Canada. As for the DDA agricultural negotiation, he said that a new attempt for an agreement is expected to be made within the end of this year if a new draft is presented by the DDA chairman by early this February. But Lim said that the chance of reaching an agreement is not so bright because of the stance of the United States and developing countries.

Lee Kye-Im, a researcher at KREI, made a presentation on Korea’s food consumption trend and its implications. In the presentation, Lim said that the ratio of dining-out cost to total food consumption cost increased to 46% in 2006 and the food consumption trend has been changing toward high-quality food, health food, convenience food, and indulgence food with increasing variety. As for the environment-friendly agricultural products market, KREI researcher Kim Chang-Gil said that the market is forecast to grow by 25% to 2.3541 trillion won this year from 1.8989 trillion won in 2007.

<A Summary of Projections by KREI Researchers>

“The percentage of urban residents who intend to live in countryside is found to be at 56.3%, and the percentage of those who plan to do so within the next ten years reaches 11.6%.”

- Song Mi-Ryung –

“The price of rice during this year’s preharvest season is expected to be 3~6% higher than the one during last year’s harvest season because the market supply of rice in the private sector is estimated to have fallen by 4.5%.”

 - Kim Tae-Hun - 

“The number of Korean beef cattle is expected increase by 50,000 to 110,000 head of cattle from last year to stand at somewhere between 2.25 and 2.31 million head of cattle, and the farmgate price is expected to fall as a result.”

- Huh Duk –

“The total cultivation area for fruit this year is expected to remain similar to last year’s level. However, the production amount is forecast to fall by 3% to stand at 2.12 million tons.”

- Kim Kyung-Phil –

“When the oil price increases by 10% from 85 dollars a barrel, the rate of income reduction for greenhouse vegetable growers will be around 9~15%, and the reduction rate will be 13~20% when the oil price increases by 20%.”

- Jeong Eun-Mi -