As fruit prices have continued to soar recently, some are pointing out that more fundamental measures to expand supply, including the easing of import quarantine, should be prescribed instead of symptomatic treatment such as discount aid. This is because there is a structural increase in the demand for fresh fruit and vegetables behind the increase in fruit prices. As a result of Maeil Business Newspaper’s analysis of price data from Statistics Korea and the Ministry of Rural Development on the 1st, it was found that most fruits and vegetables with high price increases recently are crops with the highest income for farm households. This means that the demand for fresh fruit and vegetables has increased and sales have increased.
According to Statistics Korea, the prices of fresh fruit and fresh vegetables increased by 28.5% and 8.9% last month. The rates of price increase for apples (56.8%), tomatoes (51.9%), grapes (16.8%), strawberries (15.5%), and paprika (13.8%) were particularly high. The government announced a policy to support price reductions of up to 40% by investing 16.6 billion won until May, when alternative fruits begin to be shipped in earnest. Accordingly, experts analyzed, “As interest in health increases, the demand for fresh fruit and vegetables is increasing structurally, but the order of the day is to solve the problem of supply not to keep up.”
Fruit and vegetables with the highest price increases over the last four years (2019-2023) include cucumbers (45.4%), strawberries (43.8%), grapes (43.0%), and apples (36.9%), which have the same with them. are the highest income items for farm households. As a result of the Ministry of Rural Development’s analysis of income data per crop, cucumbers produced by domestic farms (based on products promoted in 2022) took first place with an income of 18.03 million won per 1,000 m2 of farmland. The income earned by farmers growing cucumbers has jumped 48.6% in the last three years. Eggplants (12.93 million won), strawberries (12.7 million won), paprika (11.09 million won), and field apples (3.36 million won) are also high farm income items. Over the past three years, the income growth rate of these crops has been at the top, ranging from 20 to 70 percent.
Government discount support may ease the burden on consumers in the short term, but in a situation where farm incomes and demand for fresh fruit and vegetables are increasing at the same time, it stimulates prices and wholesale demand eventually causing an increase in prices. Park Young-beom, a professor of economics at Hansung University, said, “It is better for the government to increase imports rather than provide discount support for agricultural products.” Kwon Nam-hoon, a professor of economics at Konkuk University, also emphasized, “There is a need to implement a flexible quarantine system so that quarantine can be exceptionally relaxed when the price of a certain item rises significantly.”
[김정환 기자 / 이희조 기자]
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