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Even with the news that the worst of the livestock sector disease problems are now somewhat under control, the impact on both production and consumption is forecast to be significant. While consumption of grains and pork is forecast to fall, production of pork is expected to do so significantly, meaning that meat prices have risen in many areas of the country. These production concerns come at a time when the country is instituting measures to increase agricultural production to become more self-sufficient.
However, as long as grain demand (due to the westernisation of the country's diet) continues, and pig and poultry stocks remain diminished, the country will continue to require imports to feed demand.
Key Trends
Pork production growth to 2014/15: -16% to 927,000 tonnes. We expect that production will start to increase again towards the end of the forecast period once foot-and-mouth disease concerns are brought under control and farmers start to rebuild herds.
By January, approximately 15% of the country's total 12.4mn cattle and swine herd had been culled, with roughly 3mn poultry slaughtered after the avian flu virus strain was detected. As a result of the large-scale slaughtering and market closures, wholesale prices of beef and pork have soared by 9% and 22% respectively from December's average prices, compounding the government's uphill battle against rising food prices.
By February, the mass culling of approximately 20% of the country's total cattle and hog herd prompted the South Korean government to allow quota-free pork imports into the country from February 2011 until June 2011, down from the previous tariff of 25%. South Korea has lowered its pork import tariff of 25% down to zero for the next six months in a move to ensure sufficient domestic supplies following the culling of approximately 20% of the country's hog herd amid the country's worst foot-mouth disease outbreak since 2002. According to the Ministry of Agriculture, the tariff reduction will allow for an estimated 15-20% increase in pork imports for 2011, up from 179,500 tonnes in 2010. Most of the 2.2mn livestock being slaughtered are pigs.
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