Crude Oil 'Differential Pricing by Usage' Still at an Impasse... Government Says "To Conclude This Year"

"Meeting of Dairy Industry Development Committee to Conclude Discussions by End of Month"
Government "Increase Self-Sufficiency Rate"...Farmers "Will Protest if Producers' Voices Are Ignored"

On October 15th, a customer selecting a product at the milk section of a large supermarket in Seoul. Photo by Moon Honam munonam@

[Sejong=Asia Economy Reporter Moon Chaeseok] It has been revealed that there is still a significant disagreement between the government, which is promoting the introduction of a 'differential pricing system by usage' for raw milk, and the dairy farmers who oppose it.

Kim Jong-hoon, Vice Minister of the Ministry of Agriculture, Food and Rural Affairs, held the 4th Dairy Industry Development Committee meeting on the 13th at the Osong Convention Center in Chungcheongbuk-do, gathering opinions from milk producers, consumers, and academia, the Ministry of Agriculture, Food and Rural Affairs announced on the 14th.

At the meeting, Park Beom-su, Director of Livestock Policy Bureau at the Ministry of Agriculture, Food and Rural Affairs, explained that introducing the differential pricing system by usage would not reduce dairy farmers' income compared to the current level and would increase the self-sufficiency rate. The differential pricing system by usage distinguishes raw milk into drinking milk and processed milk, maintaining the price of drinking milk at the current level while lowering the price of processed milk. It has been pointed out that under the current production cost-linked system, when production costs rise, prices also increase regardless of demand, acting as a factor that raises raw milk prices. The government proposed setting the price of drinking milk at 1,100 KRW per liter and processed milk at 900 KRW per liter, applying 100 KRW per liter for quantities exceeding the contract level.

Committee members from the consumer, demand side (milk industry), and academia largely agreed with the government's plan. Professor Ji In-bae of Dongguk University said, "To develop the dairy industry, it is necessary to gain competitiveness in the rapidly growing dairy processed products market, and for this, the introduction of a differential pricing system by usage is necessary." Jeong Jae-yeon, Executive Director of Namyang Dairy Products, stated, "It is desirable to reach a broad agreement on the differential pricing system by usage and address opposing opinions through working-level meetings."

On the other hand, producers strongly opposed and demanded more support from the government. Lee Seung-ho, Chairman of the Dairy and Beef Cattle Association, warned, "The Dairy Industry Development Committee is nothing more than a rubber stamp. If the voices of producers are not continuously reflected, we will take action." Maeng Kwang-ryeol, Chairman of the National Dairy-related Cooperative Heads Council, said, "The government must provide more support for producers and consumers to accept it. Otherwise, negotiations cannot proceed."

The government also proposed increasing the number of board members of the Dairy Promotion Board, which determines domestic raw milk prices, from the current 15 to 23, increasing the number of government, academic, and consumer organization representatives. The government plans to hold one more committee meeting by the end of this month to conclude discussions on the agenda.

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