The South Korean government has asked the National Assembly to approve more funds to purchase imported rice in the face of soaring international grain prices.
The Ministry for Food, Agriculture, Forestry and Fisheries said an extra 207.8 billion won will be needed to cope with rising costs that have been exacerbated by the fall of the Korean currency.
South Korea had needed 161.1 billion won ($140.6 million) to import the 311,457 tons of rice to be paid for under a deal reached with nine exporting countries in late 2004. The import bill shot up to over 368.9 billion won.
The agreement with such countries as the United States, China and Thailand calls for increasing Seoul's minimum market access (MMA) for rice from 4 percent of total consumption in 2004 to 8 percent by 2014. In exchange, South Korea can hold off free rice imports under the 2004 multilateral trade negotiations.
Of the total that must be imported by the government, 248,402 tons will go to food processing, while 63,055 tons will be sold directly to consumers.
When the ministry asked lawmakers for funds last year to meet the MMA quota, it estimated the average price of rice needed for processing would only reach $540 per ton, while that for direct sales was calculated at $650. The ministry also predicted that the foreign exchange rate for the Korean won would hover at around 920 won to the U.S. dollar for the whole of the year.
The won closed at 1,148 won to the greenback Wednesday, while the international cost of rice used for food production jumped to $1,370 and that sold to the general public reached $1,240 per ton in August.