Ministry of Agriculture Budget 16.9 Trillion Won, Up 3.6% from This Year... 45.2 Billion Won for Vegetable Price Stabilization

National Assembly Passes Budget Bill in Plenary Session...Significant Increase in Fertilizer Budget Due to Element Supply Instability

According to the Consumer Price Trends for November announced by Statistics Korea on the 2nd, the consumer price index last month was 109.41 (2015=100), up 3.7% compared to the same month last year. This is the highest level since December 2011 (4.2%). It recorded the largest increase in 9 years and 11 months. Citizens are shopping at Yeongcheon Market in Seodaemun-gu, Seoul on this day.
Photo by Moon Honam munonam@

[Sejong=Asia Economy Reporter Kim Hyun-jung] The government will pour 45.2 billion won, an increase of 6.7 billion won from the existing budget, into stabilizing vegetable prices next year. Regarding fertilizers, which have supply and demand concerns due to the urea crisis, the budget for discount sales and purchase self-financing loans has also been significantly increased.

On the 3rd, the Ministry of Agriculture, Food and Rural Affairs announced that the budget for next year was finalized at 16.8767 trillion won, an increase of 200 billion won from the government proposal (16.6767 trillion won) during the National Assembly budget review process. This is an increase of 591.1 billion won (3.6%) compared to this year's budget (16.2856 trillion won).

During the National Assembly budget review process, a total of 218.9 billion won was additionally reflected in major projects such as reducing the burden of fertilizer prices, food support projects, and contributions to the Agricultural, Forestry and Fisheries Credit Guarantee Fund. In response to the expected rise in mineral fertilizer prices due to supply instability of urea, the government will increase the budget for discount sales and purchase financing of fertilizers from the existing 200 billion won to 600 billion won to alleviate the burden on farmers. First, to reduce the burden on farmers caused by the rise in mineral fertilizer prices, the National Agricultural Cooperative Federation (Nonghyup) will discount 80% of the 2022 mineral fertilizer price increase, and the discount amount will be shared through post-agreement among the government, local governments, and Nonghyup, with the government reflecting an appropriate budget, as confirmed in the budget resolution supplementary opinion.

Additionally, through the expansion of interest rate support for agricultural funds (264 billion won → 280.3 billion won), financial support for farms and fertilizer manufacturers will be strengthened. As in this year, 9.9 billion won will be provided to reduce the management cost burden on farmers by lowering the interest rate on agricultural management funds by 1 percentage point next year.

The loan scale for purchasing raw materials for mineral fertilizers for fertilizer manufacturers will be expanded to 600 billion won, and 6.4 billion won has been allocated in the budget to reduce the loan interest rate from 3% to zero, easing the burden on manufacturers due to the sharp rise in fertilizer raw material prices.

The budget for food support has also been significantly increased. Food support projects, including 7.2 billion won for fruit snacks in elementary after-school care classrooms, 8.9 billion won for agricultural product purchase vouchers for vulnerable groups, and 15.8 billion won for eco-friendly agricultural products support for pregnant women, have been finalized at 31.9 billion won, the same level as this year’s budget. Accordingly, food support projects to improve the nutrition and health status of elementary school students, vulnerable groups, and pregnant women, and to establish a consumption base for agricultural and livestock products, will continue next year.

To respond to the increasing demand for guarantees such as from returnees to farming and to supply credit guarantees more smoothly to farmers with insufficient collateral, contributions to the Agricultural, Forestry and Fisheries Credit Guarantee Fund will be expanded to 130 billion won.

In addition, 3.5 billion won has been allocated for mechanization of field farming, and the budget for technology development, dissemination, and surveys for carbon neutrality implementation in agriculture and rural areas has also been increased. Twenty-eight billion won has been newly allocated for paddy water management technology, and the budget for establishing an optimal cattle breeding model to minimize methane emissions during cattle rearing has been increased by 2 billion won from 2.6 billion won to 4.6 billion won. Budgets for livestock environment surveys and agricultural and livestock product discounts have also been increased.

The budget for vegetable price stabilization has been increased by 6.7 billion won from the existing 38.5 billion won to 45.2 billion won. This is the budget for the vegetable price stabilization system, which allows the supply adjustment volume of major vegetables to be expanded from 17% to 20% of the average production volume.

Along with this, additional budgets have been allocated for agricultural SOC (14.2 billion won), advanced modernization of three aged agricultural industrial complexes (2.8 billion won, first year), one youth rural settlement (800 million won, first year), and establishment of one public meal ingredient distribution center (300 million won, first year) for the development of agriculture and rural areas. Budgets for some projects with poor execution, such as livestock manure treatment support (loan, -6.1 billion won), horticultural facility modernization (-4.4 billion won), support for reducing fine dust from aged agricultural machinery (-4.2 billion won), agricultural energy use efficiency (loan, -1.5 billion won), and agri-food global non-face-to-face marketing (-700 million won), have been adjusted (total -18.9 billion won).

This content was produced with the assistance of AI translation services.