Imports of both pork and beef in South Korea fell sharply again last year. The country itself gives the market disruption as a result of the corona crisis as the cause, but not everyone believes that. This is because our own production continues to grow. Is restricting imports another step in the country's protectionist policy?
South Korea has imported significantly less pork (including offal) in 2020. Imports fell by 21% to 449.000 tons. The decline is mainly due to market disruption caused by the corona pandemic, the country's ministry of agriculture has reported. As a result, the demand from restaurants, among others, the main buyers of imported pork, is considerably lower than in other years. Exporters in the European Union (-28%) and the United States (-14%) were particularly affected.
It is not only the import of pork that is declining. The imported volume of beef is also falling. In 2019, this was a drop of 0,7% to 88.160 tons. This decline will continue in the coming years as the government of South Korea has imposed an import ban on countries with a history of BSE (mad cow disease). This mainly affects exporters in the United Kingdom, France, Germany, Canada and Japan where the disease has occasionally occurred.
It means that imports of beef and beef products from animals under 30 months of age are currently only allowed for Chile, Australia, Canada, Denmark, New Zealand, Uruguay, the Netherlands, the United States and Mexico. This may be good news for Dutch exporters, as beef exports to South Korea have fallen sharply in recent years.
New step in protectionism?
Although the corona crisis certainly affects the slumped import figures, analysts also see it as an extra step in the protectionist policy of the South Korean government. Most figures have shown a decrease for a long time. For example, the import of Dutch pork has fallen by 85% over the past five years and the import of beef from our country even shows a decrease of no less than 98%. Spain (-87%) and Ireland (-64%) have suffered the biggest blows in the area of pork in the past two years.
These falling import figures are offset by higher production figures. The most recent estimate from the US Department of Agriculture puts pork production up around 3% for this year. In 2019, pork production amounted to 1,39 million tons. That too was an increase of 2,6% from a year earlier. Compared to the 5-year average, production is about 14% higher. Beef production has increased by approximately 2,5% to 286.000 tons in recent years. According to insiders, those numbers do not correspond to lower demand, as the South Korean ministry reports.
One reason to reduce imports and increase own production is the wholesale prices in the country. At present, imported meat (both beef and pork) is cheaper than homegrown meat. The price of beef has increased by 10% on an annual basis to an average of $17,50 per kilo. For pork, the average price is about $4,30 per kilo, an increase of more than 7% in a few weeks. By comparison, in the United States, top-quality beef costs about $10,85 per pound and pork doesn't exceed $2 per pound.
In other words, a group of analysts argues that the South Korean government - by restricting beef and pork imports - may hope to bring prices back to normal somewhat on the domestic market. Whether that will happen, however, remains to be seen. This is because South Korean meat prices have always been at a fairly high level.