World Grain - April 2016 - 20

COUNTRY FOCUS

Focus on South Korea
Industrial giant is dependent on wheat,
flour and corn imports
by Chris Lyddon

South Korea is highly industrialized after several decades of
phenomenal growth, but its agriculture is hampered by a lack
of cropland which means it is, and will likely remain, a major
importer of grains.
The USDA's Economic Research Service characterizes South
Korea's agriculture on its website. "Agriculture, in contrast to
much of the rest of the economy, has little export focus and
receives heavy protection from the government," it said. "There
is not enough cropland and pasture to support both direct human
food use and animal feeding. Since the 1960s, South Korea has
been a large net importer of agricultural products.
"South Korea is likely to import greater amounts of agricultural
products in the future because of domestic market forces and
market-access measures negotiated in bilateral and multilateral
agreements. New free trade agreements with the European Union
and the United States in 2011 and 2012 included lower bilateral
tariffs on South Korea's agricultural imports."
In its Grain Market Report, the International Grains Council
(IGC) puts South Korea's total grains imports at 14.4 million
tonnes in 2015-16, up from 14.1 million the
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tonnes of wheat, up from 4 million, and 9.7
million tonnes of maize, down from 10.1
million tonnes the year before. South Korea
South Korea
is also set to import an unchanged 500,000
tonnes of rice.
The IGC puts South Korea's imports of
soybeans at 1.4 million tonnes in 2015-16,
against 1.3 million in 2014-15. The country's
soymeal imports are put at 1.9 million tonnes,
up from 1.8 million the year before.
According to the IGC, South Korea will import
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59,000 the year before.
South Korea's production is too small to be quoted
in the IGC's report. An annual report from the attaché, forecast
2015-16 wheat production at 24,900 tonnes, down 6% on
decreased planting area.
"The upland direct payment program doesn't increase wheat

North Korea

Japan

Key Facts
Capital: Seoul
Population: 49,115,196 (July 2015 est.)
Religions: Christian 31.6% (Protestant 24%, Roman Catholic 7.6%), Buddhist 24.2%, other or unknown 0.9%, none
43.3% (2010 survey).
Location: Eastern Asia, southern half of the Korean Peninsula bordering the Sea of Japan and the Yellow Sea.
Government: Republic. Chief of state: President Park
Geun-hye (since Feb. 25, 2013); head of government: Prime
Minister Hwang Kyo-ahn (since June 18, 2015).
Economy: South Korea over the past four decades has
demonstrated incredible economic growth and global integration to become a high-tech industrialized economy.
In the 1960s, GDP per capita was comparable with levels
in the poorer countries of Africa and Asia. In 2004, South
Korea joined the trillion-dollar club of world economies. A
system of close government and business ties, including
directed credit and import restrictions, initially made this
success possible. The government promoted the import of
raw materials and technology at the expense of consumer
goods, and encouraged savings and investment over consumption. The Asian financial crisis of 1997-98 exposed
longstanding weaknesses in South Korea's development
model, including high debt/equity ratios and massive shortterm foreign borrowing. GDP plunged by 7% in 1998, and
then recovered by 9% in 1999-2000. South Korea adopted
numerous economic reforms following the crisis, including
greater openness to foreign investment and imports. South
Korea's export-focused economy was hit hard by the 2008
global economic downturn, but quickly rebounded, reaching
over 6% growth in 2010. The U.S.-Korea Free Trade Agreement was ratified by both governments in 2011 and went
into effect in March 2012. Between 2012 and 2015, the
economy experienced slow growth - 2%-3% per year - due
to sluggish domestic consumption and investment.
GDP per capita: $36,700 (2015 est.); inflation: 0.7%
(2015 est.); unemployment: 3.5% (2015 est.).
Currency: South Korean won (KRW); 1,159 won equal 1
U.S. dollar (March 18, 2016).
Exports: $535.5 billion (2015 est.): semiconductors, petrochemicals, automobile/auto parts, ships, wireless communication equipment, flat display displays, steel, electronics,
plastics, computers.
Imports: $430.8 billion (2015 est.): crude oil/petroleum
products, semiconductors, natural gas, coal, steel, computers, wireless communication equipment, automobiles, fine
chemical, textiles.
Major crops/agricultural products: Rice, root crops,
barley, vegetables, fruit; cattle, pigs, chickens, milk, eggs;
fish.
Agriculture: 2.3% of GDP and 5.7% of the labor force.
Internet: Code: .kr; 44.9 million users.
Source: CIA World Factbook

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