The first shipment of sugar imported directly by the government will arrive in Korea next week that could help stabilize the commodity‘s price here, a state corporation said Friday.
The Korea Agro-Fisheries & Food Trade Corp. said 2,000 tons of sugar imports will arrive at the southeastern port of Busan on Monday to be sold at low prices to processed food manufacturers such as confectionery companies and bakeries.
The shipment is part of the 10,000 tons of sugar the government bought from Thailand and other Southeast Asian countries last month.
The move aims to break up the oligopoly on sugar imports that have been handled by three companies in the past. This tight control has been cited for high domestic sugar prices that adversely affect the government’s efforts to check inflationary pressure.
Korea is grappling with high consumer inflation. In 2011, the nation‘s consumer prices jumped 4 percent from a year earlier, hitting the upper ceiling of the Bank of Korea’s 2-4 percent target band.
“International sugar prices have stabilized in recent months, but this has not been reflected in the domestic market due to a few companies controlling all imports,” a spokesperson for the trade corporation said. He said by directly importing sugar, Seoul is moving to diversify the local distribution network and help processed food manufacturers.
Lowering sugar prices is important because it makes up 10-15 percent of the cost for beverages. It also accounts for 8-10 percent of cookies and pastries and 3-5 percent of the cost for bread and ice cream.
Last year, Seoul announced it would levy no duties on 300,000 tons of sugar to get more private companies to bring in the food product, but the plan made little headway because of the inflexibility of the local distribution network and clout exercised by the established importers. (Yonhap News)
