[FORUM]Rice problem will not disappear

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[FORUM]Rice problem will not disappear

The time has arrived for the government to explain to the general public the details of the reality of the rice market and ask for their understanding. We have to deal with the rice issue now. If the government wants to continue to avoid any public discussion of what to do about the overproduction of rice for fear of public criticism, it is acting cowardly. Helping North Koreans with our extra rice lost its justification when North Korean ships fired at our navy in the Yellow Sea. We cannot let rice keep stacking up in warehouses nationwide. Our stocks are already twice as large as we need, and we cannot just let those stocks spoil or throw them away.

Good crop yields and decreases in consumption year after year have contributed to the accumulation of rice stocks -- there will be some 2.5 million tons of rice left in government warehouses by autumn. This year's forecast is for another bumper crop, if the weather continues to be good. Even if the government and rice dealers buy up as much rice as they can from this year's crop, there may be 1.35 million tons left unsold. At least 900,000 tons, worth 1.5 trillion won ($1.2 billion), must be disposed of in some way or another if the rice market is not to be disrupted. If the market overhang is more than about 450,000 tons, rice prices will plunge and incomes of rural households will shrink significantly. It is depressingly predictable how politicians will react to the problem; they will press the government to buy up all of the rice crop and add it to the piles of sacks already making our warehouses bulge.

The National Assembly is content with non-market economic decisions when it comes to rice, making Korea the only country that makes such decisions that way among the Organization of Economic Cooperation and Development members. In Korea, the Assembly sets the price that the government will pay for rice during the year. Neither the ruling party nor the opposition party would dare to bring up the subject of abolishing the system because that would directly influence the votes of the rural sector.

No matter how enthusiastically the government wages campaigns to increase rice consumption, such as encouraging the production of more rice meal, rice wine, rice noodles and rice crackers, rice stocks keep growing. It costs the government 45 billion won a year to maintain 180,000 tons of rice. At present, about 666,000 tons of rice accumulated during the past three years are stored nationwide, increasing the financial burden on the government.

Authorities have long wanted to use those rice stocks in dealing with North Korea, but Pyeongyang has refused to cooperate, and indeed has acted irrationally. North Korea threw away its best chance for more food by firing at South Korean ships in the Yellow Sea recently.

Japan, which has a problem similar to South Korea's with rice, has also tried to use its excess rice stocks to aid North Korea whenever it seems that North Korea might respond to its efforts to start a dialogue. North Korea seems to be trying to play off South Korea against Japan. The country who responds first gains a bargaining advantage, and the laggard not only sees his diplomatic chips devalued but also suffers from financial pressure from an increased rice stockpile.

Another threat is the expansion of China's rice production. The amount of rice grown in three provinces in northeast China is 2.5 times the total rice production of South Korea. Chinese prices are only 13 percent of ours. South Korea has to resume international talks on opening its rice market in two years; China is counting the days.

We have little time to choose how to handle our excess rice stocks. First, I propose that the government look into using rice as feed for chicken or pigs. Koreans, traditional rice growers, feel a special attachment to rice. We may reject the idea of using precious rice as animal feed. But the reality in the rice market demands a change in sentiment. Korea imported 960 billion won worth of animal feed last year.

Second, the government should think about expanding its support for low income families and underprivileged children. Who would have thought that rice could be a burden? The government should explain the current rice situation to the general public and ask for its cooperation.


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The writer is a JoongAng Ilbo editorial writer.

by Choi Chul-joo

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