Livestock Infectious Disease Outbreak Drives 6% Rise in February Livestock Product Prices

Agricultural and Livestock Products Up 1.4%
Falling Agricultural Prices, Rising Livestock Prices

Due to the spread of livestock infectious diseases such as highly pathogenic avian influenza (AI) and African swine fever (ASF), livestock product prices rose by 6% last month.

On March 6, the Ministry of Agriculture, Food and Rural Affairs announced that, according to the analysis of the "February Consumer Price Index" released by the National Data Office, the consumer price index for agricultural and livestock products rose by 1.4%, which is lower than the overall inflation rate of 2.0% year-on-year, indicating that prices have remained stable.

The Asia Business Daily Database

For agricultural products, prices for most items, except for rice and apples, remained lower than last year, resulting in a 1.4% year-on-year decline. In particular, open-field vegetables such as napa cabbage, radish, carrot, and cabbage saw increased cultivation areas, ensuring stable supply. Greenhouse vegetables such as Cheongyang chili peppers, lettuce, and paprika experienced a slight price increase in February due to a sharp drop in temperature, but recent crop recovery has led to a downward trend in prices.

To stabilize the supply and demand of rice, which has seen a price increase, the ministry will gradually supply 150,000 tons of government rice reserves. For apples, 15,000 tons will be supplied through contract farming and 35,000 tons through designated shipments, with distribution volumes managed appropriately according to market conditions to ensure stable supply in the market until the harvest of new fruit in July. For onions, whose prices have fallen sharply due to increased storage quantities, the ministry will promote consumption by utilizing producer funds and discount support budgets until the shipment of early-harvest onions begins.

In addition, for imported fruits such as bananas, pineapples, and mangoes, which have seen price increases due to poor harvests in exporting countries and high exchange rates, the ministry has applied a 5% tariff quota instead of the previous tariff rate (12-30%) since February 12. The ministry also plans to strengthen management by inspecting the import clearance and distribution process to ensure that the benefits of the tariff reduction are reflected in consumer prices.

Livestock products rose by 6.0% year-on-year due to a decrease in production and the spread of livestock infectious diseases. For Korean beef, as farmers reduced the number of cattle raised during the period of low prices in 2023–2024, the number of cattle being raised as of March was 3,247,000, down 4.1% from the previous year, resulting in a reduced volume available for slaughter. In addition, imported beef prices have increased due to decreased production in exporting countries such as the United States and exchange rate fluctuations, and high prices are expected to persist for the time being.

Pork prices rose in February due to sporadic outbreaks of ASF and increased demand during the holiday season. However, slaughter volumes are expected to increase somewhat after March. For chicken and eggs, prices rose as the scale of culling expanded due to the occurrence of highly pathogenic AI, and as movement restrictions were repeatedly imposed.

The ministry plans to alleviate consumer burden by using producer funds and discount support budgets to provide discounts on pork (around 20%) and eggs, and will focus on inspecting the distribution process to identify and rectify any unreasonable practices.

Food and dining-out prices rose by 2.1% and 2.9% year-on-year, respectively. Although there are factors driving price hikes for processed foods, such as high exchange rates, further increases have been limited due to the decline in raw material prices for items such as sugar and flour. In addition, as raw material prices have fallen, companies like Paris Baguette and Tous Les Jours have decided to lower product prices, and the industry is making efforts to reflect the decrease in raw material costs in final product prices.

Jeonghun Park, policy chief for food and grain at the ministry, stated, "We will continue to strengthen cooperation with the industry to ensure that the decrease in major raw material prices is reflected in consumer prices for processed foods, and will provide ongoing support such as funding for raw material purchases. We also plan to strengthen supply and price monitoring for key items, secure reserve and contract volumes, and actively address and improve any unreasonable factors in the price-setting structure of agricultural and livestock products."

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