[EDITORIALS]Courage needed on riceTyphoon Rusa and other rains this summer took a terrible toll on rural communities. The government said Monday that the total rice yield for this year may be around 34-35 million sacks, down about 3.5 million sacks from 2001. Even with the small adjustments that will be made in the final survey at the end of October, the government estimate signals the first bad year for rice harvests since 1996. The essence of the government rice policy must be to guarantee income stability for rice farming households. Nearly all farmers have been afflicted by plunges in rice prices at harvest time as new rice pours out on the market. We ask the government to purchase the rice production at the right time this year and expand support for private rice distribution centers to spare farmers the double whammy of bad yields and a tumble in prices.
But one year's bad harvest is not an omen. Rice stocks here, even excluding the promised aid to North Korea, will still stand at about 10 million sacks at the end of October. The oversupply of rice has been going on for a long time and cannot be corrected by one or two years of effort. Even with lower yields, rice production this year will still outpace consumption. By the end of October 2003, rice stocks will be 12 million sacks, twice the level of reserves recommended by the World Health Organization.
Another pending issue is how to deal with pressure to open the rice market. Taiwan recently decided to open its rice market, which narrowed the options available to Korea. If we opt to open the market and impose tariffs on imported rice, that tariff is limited to 460 percent of the import price. But the price of imported rice will still be 5-7 times cheaper than domestic rice. The imported rice will surely gobble up the domestic market with that price advantage.
The government wants to shift production here to high-quality rice and use market mechanisms to balance supply and demand. But no one seems to want to start working on that policy. How do we genuinely help farmers? If the rice market opens and we are not ready, farmers will be the victims. Unfortunately, based on the government's actions -- or lack of actions -- to date, that seems to be the most likely outcome. A year's bad yield does not change the underlying problem or the best remedy. The government must reform its rice policies despite this year's bad harvest.