Public auction of imported rice from the United States kicked off yesterday to allow foreign rice to be sold directly to consumers on the market for the first time. But it appears negative public sentiment toward foreign grain drew a very cool response, industry experts say.
"The number of bids we've received on the first day of our public auction is very low. It is quite a serious concern," Kim Kyung-mee, an official from the Agriculture Ministry's Food Grain Policy Division, told The Korea Herald.
The Agriculture Ministry began electronically auctioning the initial shipment of foreign rice - 1,300 tons of first-grade American Calrose rice - through the state-run Korea Agro-Fisheries Trade Corporation. But only 16 distributors submitted bids and only one winner has been entitled to sell 40 tons of the U.S. grain, the ministry said. It declined to disclose the auctioned off price.
Korea saw the first shipment of foreign rice totaling 1,372 tons from America on March 23. This was the first shipment of the 22,557 tons the country was obliged to import as of last year from China, the United States, Thailand and Australia under agreements made with the World Trade Organization in 2004. The current volume represents 10 percent of 225,575 tons Seoul agreed to import for last year with nine rice-exporting countries. Korea is required to almost double its import quota to 7.96 percent of its total domestic consumption by 2014.
Rice farmers have been vociferously opposing trade deals that call for a further opening of the rice market. They fear being driven out of business.
And retailers generally agree that it would be in their best interest to wait and see what imported rice has to offer consumers in terms of quality, taste and pricing. They also prefer to prevent possible protests at their storefronts which could be ignited by angry farmers or civic groups.
With almost no takers for imported rice, the government says it can only wait until public opinion improves. Until then, imports will continue to pile up.
"There's not much the government can really do. We can't break our agreement with the WTO nor can we change our method of selling the foreign grain. Starting with a public auction is the route we agreed to take with our negotiating partners," said Kim.
Concern over a clash between angry farmers and bidders was a major reason for the government to decide to conduct an electronic bid.
Agricultural groups have been threatening to stage demonstrations in front of the Agro-Fisheries Corp. in southern Seoul.
"We can only wait and see how the auctions progress. This was only the first of many more," said Kim. The Agriculture Ministry said public bids will take place every Wednesday.KOREA HERALD
