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Appeasing the pork farmers

Published: 03 Apr. 2012, 20:26

A pork supply crunch was avoided after the government and the Korea Pork Producers Association reached a deal. The government offered to scale back a planned duty-free import of 70,000 tons of frozen pork belly to 20,000 tons. Pig farmers called off their plan to stop supplying pork to the market for an indefinite period starting from this week. Korean consumers are happy that they will not be deprived of one of their favorite meat dishes. But the deal leaves a sour taste as it was obviously struck to appease farmers ahead of the April elections. It was a poor precedent for how to deal with such an impasse and does little to solve the supply problem and price instability in the pork trade.

The dispute with the farmers started last month when the government decided to extend duty-free imports of pork to keep the price low. It wanted to import 70,000 tons. Pork farmers, fearing a plunge in prices of local meat due to the cascade of cheaper imports, staged protests in front of the National Assembly, threatening to stop supplies from Monday. The Ministry of Food, Agriculture, Forestry and Fisheries went into negotiations with the association and cut a deal to slash the import volume. Both bodies failed to listen to and reflect the consumers’ view of the affair. The side with the louder voice - in this case, the farmers - won.

But collective action and makeshift deals are no answers to the supply problems in the pork trade. Unless farmers find a way to control supply to meet market demand, supply and price instabilities will recur. Consumers paid more for pork than for beef due to a supply shortage following the crackdown on foot-and-mouth disease. But farmers staged a collective action to protect pork prices when the government wanted to import to stabilize prices. At the end of the day, consumers are the victims, and they will have to continue to pay high prices for local meat. This isn’t only about pork meat. The government wrangles over the same problem with cattle and cabbage farmers every year. The government and farmers should not push consumers’ patience too far.