Transition Team Holds Meeting with Distribution and Agricultural Development Companies on Grain Price Surge: "Securing 3-5 Months of Inventory"

Ahn Cheol-soo, Chairman of the 20th Presidential Transition Committee
Photo by Yonhap News

[Asia Economy Reporter Jeong Dong-hoon] On the 6th, the Economic Subcommittee 2 of the Presidential Transition Committee held an 'Industry Meeting to Review and Explore Responses to the Global Grain Supply Chain' amid the surge in global grain prices following Russia's invasion of Ukraine.

The meeting was attended by companies responsible for grain import, distribution, and overseas agricultural development such as POSCO International, Pan Ocean, CJ, Nonghyup Feed, SPC, and Lotte Trading, as well as officials from the Ministry of Agriculture, Food and Rural Affairs, and experts including Wang Yoon-jong, a member of the Economic Subcommittee 2 of the Transition Committee.

Attending companies stated that domestic grain import and distribution firms have swiftly shifted from Russian and Ukrainian grains, which have faced supply disruptions, to grains from North America and other Eastern European countries. The Transition Committee also confirmed that they have secured inventory equivalent to 3 to 5 months of the supply volume needed domestically.

Grain import and distribution companies expressed concerns that "the use of grains with short-term price increases is raising industry cost burdens, leading to worries about price hikes in flour and feed," and requested low-interest financial support and tax reductions. Specifically, the industry asked for a temporary expansion of the limit and rate of the agricultural product deemed purchase tax credit to offset cost burdens for food, dining, and feed companies.

In the mid to long term, the meeting discussed measures to support and incentivize private companies to take the lead in securing overseas grain distribution networks. Additionally, discussions were held on expanding reserves of staple food crops and releasing them in times of crisis, as well as the need to strengthen the domestic production base, according to the Transition Committee.

The Transition Committee plans to supplement and develop the discussions from the meeting and reflect them in national policy tasks.

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