Ups and downs in food security
There are elevators for grain, too, which are used for drying, storing, grading, processing and transporting grain. Depending on the location, there are three types of elevators - country, river and export. Country elevators are similar to granaries. Grains gathered at country elevators are sent to all parts of the world through export elevators located at major ports. The export elevators are essential to the grain distribution network. And four major grain companies - ADM Milling, Bunge, Cargill and Dreyfus - have a monopoly. Over the past 100 years, they have increased their market share to 85 percent and have an enormous amount of power over the supply and market price.
That’s why we have raised the issue of food security. At present, our self-sufficiency rates for wheat and corn are only 0.8 percent. That of beans is 8.7 percent and barley 26.6 percent. Only the rate of rice is over 100 percent. This imbalance in grain production is the result of a misguided farming policy. Farmers concentrated on rice farming because the government purchased rice at a higher price than the market, even though the supply was already great. Therefore, our grain self-sufficiency is 54.9 percent, and the rate goes down further when the shortage of feed grain is added on top of it. Of the total domestic grain consumption of over 20 million tons per year, Korea’s reliance on imports is more than 75 percent.
It has been reported that the government will soon establish a grain company in Chicago. The project was initiated by the Korea Agro-Fisheries Trade Corporation in collaboration with Samsung C&T, Hanjin Group and STX Group. Their first step is to purchase 10 country elevators and rent export elevators from the four major elevator companies.
But there is a major flaw with the way the consortium is executing the plan. The purchase has already been announced by the government, but this information should have been kept under wraps until the purchase is made. Prices are likely to jump now that it’s been revealed that the would-be buyer is the Korean government. But it is troublesome because this purchase could be vital to our food security.
*The writer is an editorial writer of the JoongAng Ilbo.
By Shim Shang-bok