South Korea

Market Snapshot 2018 - South Korea - Commodity Table

Supply/Demand Basics

  • Coarse grains demand of 12 MMT/ year – 2% imported: 78% for feed, 16% corn milling, 6% beverage alcohol and others.
  • #3 import market of U.S. corn in 2016/2017.
  • #3 import market of U.S. DDGS in 2014/2015.
  • Very limited barley and sorghum imports despite KORUS FTA.
  • Livestock industry and compound feed market growing marginally.

Country Overview

  • Population / growth: 7 million / 0.5%
  • Urban % / growth: 7% / 0.55%
  • GDP / growth: $2 trillion / 0%
  • GDP per capita: $39,400
  • Asia’s 4th and world’s 11th largest economy.
  • Asia’s 4th and world’s 11th largest economy.
  • Facing sluggish domestic demand, increased household debt, low youth unemployment, falling birth rates and aging population.

Trade and Market Share Issues

  • Sophisticated price buyer; U.S. share is very volatile depending on price competitiveness.
  • Corn quality (Higher BCFM) has been a chronical issue that creates a slight premium on SAM origin.
  • U.S. DDGS imports continue to increase since 2013 due to the increasing inclusion rate.
  • Old crop rice supply for animal feed is increasing: 520,000 MT (2017) → 720,000 MT (2018)
  • Barley demand for rice substitute has been decreased due to reduction of rice consumption.

Policy Issues

  • MRLs change to PLS (Positive List System) from 2019: Korea feed & food grain industries concern of the chemical treatment on the exporting grains.
  • Biotech approval system is slow and unpredictable: 30% of biotech review committee members are replaced biennially.
  • GMO has become political issue: Anti-GMO sentiment continues to be widespread.
  • Currently, no fuel ethanol RFS, a possibility to adopt fuel ethanol RFS after 2020.

Market Snapshot 2018 - South Korea - Chart