One of the major dairy industry groups in the nation, the Korea Dairy Beef Cattle Association was once MAFRA’s primary source of resistance in the ministry’s intentions to restructure the local dairy sector in order to improve self-sufficiency, an endeavour that has been continuing since 2021.
One of the MAFRA’s intended strategies is to lower the prices of milk sold by processed dairy brands, which is a strategy that the association strongly opposes. MAFRA wants to change the current supplier-friendly system that has caused local milk prices to be elevated for some time. This system is one of the factors that has caused local milk prices to be elevated.
Earlier this year, MAFRA made a formal announcement that it would no longer be engaging the association in any further talks about the system reform. The announcement came after a final effort to clarify how the sector revamp is intended to benefit the industry. The reason given for the decision was a ‘lack of trust’ on both sides.
It seems that MAFRA’s policy of using strong-arm tactics has finally had some results in the shape of a sit-down discussion to agree how to continue. The association replied with anger and fury; however, this had little effect.
“The heads of the dairy trade unions, industry groups, and dairy processing associations have now all agreed on the need to introduce a differential pricing system,” Minister of Agriculture and Food Resources Jeong Hwang-geun said in a formal statement. This system will affect the prices for both unprocessed milk and milk that has been processed.
“This is expected to be an improvement over the current system, which determines prices based solely on production costs without any regard for market conditions, and hopefully things will improve with the new system taking into account supply and demand conditions. “The current system determines prices based solely on production costs without any regard for market conditions.
“The decision-making structure of the national Dairy Promotion Association has also been rationally reorganized. [One key change is that] decisions will now be made with a majority vote [as opposed to the previous] need to have agreement from two-thirds of directors present, so that various dairy issues can be widely discussed; and we are also looking to include the participation of more neutral persons such as consumers and academia on the board of directors. ” “The decision-making structure of the national Dairy Promotion Association has also been
As part of this agreement, dairy firms have been strongly encouraged to initiate fresh pricing negotiations as quickly as is humanly practicable.
Is there going to be a conclusion to the dairy dispute?
In spite of the fact that it had previously lashed out at the government for excluding it from discussions and referred to the new system as “irresponsible” and “shortsighted,” the Korea Dairy Beef Cattle Association has not made any negative remarks after this most recent meeting.
It was said in a separate statement that “the ultimate aim of both parties is the same,” and that “lowering the burden [of farmers] and boosting South Korea’s milk self-sufficiency” are the two goals that are most important.
Having said that, given the association’s staunch opposition to the reforms, which includes plans to protest at dairy companies that support them, it does seem a little strange that it is continuing with negotiations despite the fact that no concessions have been made – at least not in public. This is especially true given that the association has plans to protest at dairy firms that back the reforms.
It would seem that MAFRA is likewise committed to seeing the improvements through to completion. As a result, the number of votes required to pass decisions has been cut down, and more people from fields unrelated to the industry have been invited to participate.
It seems that a temporary halt to hostilities has been agreed upon; but, it is unknown how long this peace, which appears to be precarious, will be able to last.
