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2014 Media Kit
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S.Korea to scrap rice import caps from start of next year

By: | at 04:19 AM | Breakbulk & Projects  

South Korea will on Friday announce plans to scrap caps on rice imports from the start of 2015, instead managing shipments into the country using a system of steep tariffs, domestic media outlets including the Yonhap news agency reported on Thursday.

The ministries of trade, agriculture and finance will hold a joint briefing on Friday on the country’s rice import policy, their spokesmen said. He declined to give details.

The shift has long been expected as a 20-year-old agreement on rice import quotas with the World Trade Organisation expires at the end of 2014, with the nation under pressure to take bigger steps to open its markets for the staple grain.

While the possible move is unlikely to spark a short-term surge in rice imports as hefty tariffs would deter buyers from making overseas purchases, it marks a key psychological shift in a politically sensitive sector, with critics in the country fretting it could pave the way towards lower duty down the line.

The level of import duty is yet to be finalised, but government officials and industry experts have said it would likely be around 300-500 percent, bringing prices for imported rice in line with local grain.

Under the current WTO agreement, South Korea must buy 408,700 tonnes of foreign rice this year, or 9 percent of its demand. The amount that must be purchased abroad has gradually increased from 51,000 tonnes in 1995.

China usually accounts for 50-60 percent of total imports, the United States for 20-30 percent and Thailand for 10-20 percent, government data shows.