Archive for the ‘Agriculture’ Category

North Korean rice prices have dropped drastically one year after the sanctions. Why?

Wednesday, February 8th, 2017

By: Benjamin Katzeff Silberstein

Prices for rice have fallen in North Korea. Daily NK, which tracks prices of rice and foreign currency in three North Korean cities, reported in the beginning of this week that rice prices have fallen thanks to continued development of the market economy and a steady flow of goods to and from China. This has happened despite expectations that the sanctions that the UN passed one year ago would cause inflation.

In theory, the sanctions were supposed to curb trade with China because they targeted North Korea’s crucial minerals trade. In practice, a steady stream of news from the border suggests that trade has continued, albeit with periodic squeezes, following a familiar pattern of China’s sanctions implementation waxing and waning.

This makes a lot of sense. A better functioning and more efficient market should logically lead to lower prices, as should increased trade with China, given the increase in supply. But neither of these two factors explains the timing. There are several other elements to take into consideration when analyzing price changes in North Korea. I am not making any certain claims here about the relatively drastic shift in prices, but rather, pointing to a few factors that may have contributed.

First, one must ask: how big is the drop? The short answer is: pretty big, but not unprecedented. The following graph shows the last and first price observations in the Daily NK market prices database for every year since 2010–2011. (I’ve excluded 2009–2010 because of the distortions that the 2009 currency reform creates in the data.) It shows that a similar price drop happened between 2011 and 2012 as well.

Graph 1: rice prices in North Korea, last and first year observations. Graph by NKeconwatch.com. Data from Daily NK.

This latest price point, however, is not a historic low-point. We’ll see if prices continue to drop over the weeks, but as of now, there are fairly near time points when prices have been lower, such as April 2014 (see graph further down).

Prices are seasonal to a degree. Though the market system and the public distribution system (PDS) obviously function under very different mechanisms, the following graph from the World Food Program’s 2013 food and crop assessment (the latest exhaustive one they published, to my knowledge) underscores the point that supply varies depending as the harvest draws farther and closer, and suggests that overall supply tends to be particularly good in December and January in other years as well:

Figure copied from World Food Program Food and Crop Assessment in the DPRK, November 2013, showing seasonal variations in government grain distribution.

Overall, the story under Kim Jong-un’s tenure seems to be one of price stability. Since around the spring of 2014, prices have moved in a fairly delineated fashion (as visible in the right half of this graph):

Rice prices, average of three cities, 2012–2017. Data from Daily NK, graph by NKEconwatch.com.

Second, though it would be intuitively easy to conclude that the drop in prices was caused by better functioning market mechanisms and agricultural management changes, this doesn’t seem to be the whole story. Again, such changes are crucial and may well have played a large role in the greater price stability of the past few years. But they would not explain this sudden shift.

Instead, the story seems to partially be the opposite, one of government action. A few days ago, Voice of America reported that PDS distributions in January of this year have, according to a World Food Program official, gone up by around ten percent as compared to the same period last year. Both in September and November, the North Korean government imported significantly larger quantities of rice than usual. These imports presumably go out through state channels rather than the private markets.

So while it’s impossible to isolate different effects from one another, it looks like the state can still have a significant impact on the food economy, even with the strong and continuously evolving market sector. This impact seems particularly likely this time around, given the sudden drop in prices. Only time will tell whether drop continues, or if prices continue to bounce within the limits of the past few years.

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Rice prices on steady decline

Monday, February 6th, 2017

According to the Daily NK:

Rice prices in North Korea’s markets are reportedly on a downward trend. It was originally expected that the sanctions implemented by the international community would lead to inflation due to trade reductions, but a year after the sanctions were implemented, prices have instead fallen due to the steady development of marketization and active trade with China.

According to recent findings by Daily NK, rice is trading at 4,000 KPW (per kg) in Pyongyang, 3970 KPW in Sinuiju, North Pyongan Province, and 4190 KPW in Hyesan, Ryanggang Province. This represents an approximate 1,000 KPW reduction from a year ago (Pyongyang 5019 KPW, Sinuiju 4970 KPW, Hyesan 4980 KPW).

A source in North Hamgyong Province told Daily NK on January 30, “I know that China donated a large amount of rice after the flood damage in September last year. I also heard that rice farming in North and South and Hwanghae Provinces and South Pyongan Province went well.”

The price of rice in Hoeryong City (North Hamgyong Province), which suffered severe flood damage last year, is at approximately 3,600 KPW. “Rice was about 5,000 KPW in January, but prices have fallen now, so women preparing for the New Year’s holiday were fairly pleased,” she said.

“Rice prices have also been slowly dropping since the end of last year at the Pyongyang markets and reached 4,000 KPW this year. Traders (who purchase products to sell elsewhere) lining up at the market entrance to buy rice coming in from the countryside are saying that the amount of rice circulating in the markets has definitely increased compared to January last year,” a source in South Pyongan Province said.

“Rice prices in most markets in Pyongyang are declining, with more than 70% of rice being imported from China. People usually mix Chinese rice with Korean rice because Chinese rice is too dry (as if it has been in storage for a year), unlike the sticky Korean type.”

VOA (Voice of America) reported on January 26 that North Korea’s total rice imports from China amounted to 4.2 million tons last year (2016), a 2.4-fold increase over the previous year (2015). This statistic was put forward by Kwon Tae Jin, Director of East Asia Research at the GS&J Institute, citing an analysis of data published by China’s General Administration of Customs.

Sources within North Korea have consistently pointed out that revitalized market activities have played a role. “In the past (Kim Jong Il’s time), rice prices increased whenever the regime cracked down on market activities, but people are now able to do business without many restrictions. In the current situation, it’s unlikely that the price will suddenly jump,” a source in Ryanggang Province said.

Market stability has been a hallmark of Kim Jong Un’s rule and is thought to be reducing backlash from the general public as their quality of life improves.

However, the ongoing decline in rice prices is likely to lead to livelihood instability for farmers. If rice prices fall while the prices of other commodities (Chinese imports) remain the same, issues are likely to arise.

“The prices of commodities other than rice have mostly increased. As a result, a growing number of farmers are worrying that they will be unable to survive on farming alone,'” the Ryanggang-based source said.

Read the full story here:
Rice prices on steady decline
Daily NK
Kang Mi Jin
2017-2-6

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The size of North Korea’s market economy, and why it matters

Saturday, December 10th, 2016

By Benjamin Katzeff Silberstein

The other day, South Korean think-tank KINU (Korean Institute for National Unification) reportedly claimed that North Korea has 404 official markets in total. As Curtis Melvin has already pointed out on twitter, the real number is actually higher, but all this depends on what precise definition you use of markets (institutionalized and government recognized, versus operating in a legal gray zone, et cetera). As this report by the U.S.-Korea Institute laid out last year – also using satellite imagery, like the KINU report does – markets have grown significantly in size since the early 2000s.

The more interesting figures, in my opinion, are KINU’s estimates for what the markets actually generate in terms of income for the government, and how many people they employ. Below, I place these figures in a comparative perspective within the economy as a whole, and discuss the proportional weight of the markets in the North Korean economy. But first, some of the usual caveats:

As with any figures relating to the North Korean economy, a great deal of caution must be exercised in approaching these numbers. It would seem nearly impossible, for example, to accurately calculate the number of people employed by the markets. In theory, this should not be that hard. Using Google Earth, you can measure, with a fair degree of accuracy, the size of the trading grounds, and knowing the rough size of the average market stall in a North Korean market and how many people work in each one, getting a rough number for the amount that they employ should not be impossible. It would be a very rough estimate but arguably that is better than nothing. But in practice, it would still not give the full story of how many people work in the markets, since many people work there part-time, at least according to (possibly outdated) anecdotal evidence.

Moreover, it is important to remember that the market system is not the entire private sector – many other types of exchanges and transactions go on in the North Korean economy, not all recognizable from above, in complexes such as residential buildings and the like, where small business have been known to operate from. So any number for government revenues, it is important to bear in mind, will only be an estimate (again, a very rough one) for the specific type of markets that KINU has recorded. KINU does not seem to have made its report available online yet – perhaps their methodology is laid out clearly enough to answer some of these questions.

What do the numbers tell us?

Still, the numbers are interesting as starting points for a broader analysis of the proportions and size of the North Korean economy. Starting with the number of individuals employed within the market system, KINU puts the number at 1.1 million. This is about 1/25 of the entire population of the country, as derived from the 2008 census. Table 34 (page 187 and onward) gives the total working-age population as approximately 17.37 million. Subtracting the share of the population listed as “studying,” we get around 16.4 million. Further subtracting the share of the population listed as “retired,” which arguably we shouldn’t do since elderly North Koreans are known to be significantly involved in market activities, we get approximately 13.3 million individuals. I do not subtract the share listed as “doing housework” simply because it seems far too unlikely that such a category in North Korea would really be excluded from the market labor force.

Just assuming as a theoretical experiment that KINU’s figures and the census numbers are accurate, we get a 7.5 percent share of people employed in the official market sector. In reality, the share may well lower since many people in the demographic groups subtracted are known to be involved in market activities. Conversely, it may be higher if KINU’s number does not take part-time workers into account or otherwise underestimates the number of market workers. Wheher or not one thinks this to be a high or low number is a matter of perspective. For comparison, the share of the labor force employed in retail trade in the United States was 10.2 in 2014.

Another interesting figure KINU gives is that for government revenue from the markets. Again, this, too, should not be hard to estimate in theory: if you approximate the amount of market stalls through satellite imagery and multiply the amount by the fee paid by each trader to the government, it shouldn’t be impossible to get a rough estimate for how much the trade brings the government. But of course, here, too, complications abound: when looking at markets from above, it is nearly impossible to determine exactly how large the actual trading grounds are, for example, and how much is made up of administrative and storage facilities. Still, an approximate estimate is immensely valuable as a starting point for a broader debate.

According to KINU, the North Korean government collects between $13 and $17 million per day in fees from market traders. Ever since 2003, the North Korean market regime has become increasingly formalized and incorporated into the official economy. This trend has reportedly continued under Kim Jong-un as well, and arguably accelerated during his tenure. This is clearly a wise move from a policy perspective: the government needs the markets and it needs the revenue, and their depiction as a threat to the regime may not be the full story.

Using the low number of $13 million gives us a figure of $4.7 billion in revenue per year, while the higher figure of $17 million gives $6.2 billion per year. Both the low- and the high-end estimates would put government revenues from market fees at a significantly higher figure than, for example, North Korea’s trade with China. In 2015, for example, North Korea’s exports to China estimated a total of $2.95 billion. The latest sanctions additions are estimated to take off around $700 million from North Korea’s export incomes. It is important to remember that even if they were to accomplish that, which remains doubtful, North Korea still has a domestic economy that matters greatly too. And remember – these are only estimated (estimated!) figures for government revenue from a specific type of market. They do not represent the entire private sector in North Korea.

So, while the role of exports should not be underestimated, it is important to remember that North Korea has a domestic economy of considerable size. Perhaps whatever pressure the sanctions applies on the North Korean economy could serve as an argument for those in the policy bureaucracy pushing for economic reforms that could further let the private economy develop.

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KINU report claims North Korea has 404 markets

Saturday, December 10th, 2016

Benjamin Katzeff Silberstein 

As reported by Yonhap here (I will try to find a link to the full report as soon as it is up):

North Korea currently has 404 official markets which employ some 1.1 million people, a local think tank said Friday.

The Korea Institute for National Unification (KINU) came up with the figures based on an analysis of the North Korean markets using Google Earth and a survey of North Korean defectors. The total does not include unauthorized markets.

Google Earth is a Google application that lets the user look at any corner of the earth as if viewed from a satellite.

The average number of customers reaches 57,000 per market. Nine markets are larger than South Korea’s famous 14,437-square-meter Dongdaemun Market in terms of their respective size, according to a KINU report.

The institute estimated North Korea collects US$13-17 million a day in usage fees from merchants selling goods at the markets. The communist state has received the fees since it gave an official permit to the markets in 2003, it said.

The communist state also has many temporary markets that have not gotten official authorization from the state, known as “Jangmadang.” These markets are set up in vacant fields where local merchants gather to sell and trade goods.

Full article:

N. Korea operates 404 official markets: report
Yonhap News
2016-12-10

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North Korean leader visits fishing station on the East Sea, emphasizes raise in catch

Tuesday, November 22nd, 2016

Institute for Far Eastern Studies (IFES)

Kim Jong Un visited a fishing station in the East Sea (Sea of Japan) area, and ordered that the catch be raised. Under leader Kim Jong Un, phrases like ‘the Golden Sea’ and ‘Socialist scent of the Sea’ have become prominent. The Korean Central News Agency (KCNA), North Korea’s official wire service, reported that Kim visited the May 27 and August 1 Fishing Stations and conducted on-the-spot guidance.

The report stated that “Workers in the people’s army fishing sector and fishermen fulfilled their annual target set for them by respected comrade Kim Jong Un by November 7th by waging a fishing battle. They achieved dazzling success in catching 10,000 tons of sailfin sandfish, and continue to raise the amounts caught.”

Kim, first visiting the May 27 Fishing Station, indicated his satisfaction, saying, “I put many issues aside to come and convey this extraordinary news of success in the fishing industry to all the people. . . . Seeing the fishing station and apartments unfold before me like a picture as I was coming here was worth the trip. The East Sea area has a town in a state of ecstasy.”

The KCNA also reported that the May 27 fishing station had been built on the orders of Kim Jong Un, who also visited the site while it was under construction back last year in March. “It is another pride of the Songun era, with all the necessary and cutting edge facilities needed for the production of aquatic products and for the lives of fishermen.”

Having seen the fishing station, Kim said: “The People’s Army has shown how the Party’s policy, which states that using the mental energy of people one can create something from nothing, can be achieved. . . . The docks of the East Sea overflow with the smell of fish. I feel pleased to think of the parents who sent their children to guard the fatherland feeling happy when they smell this.”

Following this, Kim visited the August 1 Fishing Station, and said: “Seeing the fish piled high like a mountain for enough supply until next September I feel very happy, and feel all my fatigue leave me. . . . The organization at this facility is most satisfactory.” The Fishing station supplies orphanages, kindergartens, schools and nursing homes across the country with fish.

Kim Jong Un also discussed achievements in resolving the following problems: scientific fishing that enables fish to be caught regardless of the season; achieving a high standard of expertise, modernization and use of information technology in production and operations, introducing modern fishing methods, and increasing the catch; guaranteeing that fishing happens on more than 300 days, not allowing the seasons to keep the seas empty; equipping facilities with high quality refrigeration; taking a deep interest in the lives of fishermen; and stimulating energetic competition between fishing stations and individual boats.

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Rice prices in North Korea fall due to harvest, imports

Monday, November 7th, 2016

Benjamin Katzeff Silberstein

Says the indispensable Daily NK:

Rice prices in some regions of North Korea have reportedly fallen by approximately 1000 KPW over the last few days. The price of rice has generally hovered around 5000 KPW per kilo since Kim Jong Un took power, but recently dropped to 3500 KPW due to an increase in supply from the harvest season and rice imports.
A Daily NK source in North Hwanghae Province reported on November 3 that the price of one kilo of rice was about 4800 KPW in the middle of last month, but has now fallen to 3500 KPW over the last few days.
“People are happy about the price drop,” she said.
“Although rice prices in the markets around the northern regions (North Hamgyong Province, Ryanggang Province) are continuing to average 5000 KPW per kilo, it’s being sold at 3500 KPW per kilo in the rural areas of North and South Hwanghae Provinces. It’s believed that this was caused by a fairly good harvest in the agricultural zones of the provinces of North and South Pyongan and North and South Hwanghae, which was better than last year.”
In North Korea, rice prices fluctuate in accordance with grain production. During the harvest season, prices tend to drop when increasing volumes of rice enter the market, most of which occurs via embezzlement channels set up by officials.
“During the harvest season, officials in charge of the farms embezzle a proportion of the rice for themselves and sell it at the market, which seems to be the reason for the recent decline in rice prices,” the source said.
In addition, public sentiment towards the change in prices also has an impact on prices. Rumors have been spreading among the residents that large volumes of rice will be donated by UN agencies, prompting vendors to try and sell their own product more quickly.
There has also reportedly been an influx of imported rice into the market, further driving up competition.
Addressing this phenomenon, VOA (Voice of America) reported that since the Kim Jong regime came to power, North Korea imported the largest volume of rice from China on record (on monthly basis) in September. According to an analysis of recordings from the Chinese General Administration of Customs by Kwon Tae Jin (director of the Center for Studies on North Korea and Northeast Asia at the GS&J Institute), the volume of Chinese grain imported into North Korea in September reached a total of 18,877 tons.
“Upon seeing the imported rice being sold in the market, local merchants have dropped their prices to try and sell all of their product. The wholesale dealers and vendors in the rice trade all seem a bit confused by the rapid fluctuations in price,” added a source in South Hwanghae Province.
However, this phenomenon may only be a temporary occurrence, as rice prices in other regions remain relatively stable. As the rice influx circulates among the other regions, it is thought that prices will stabilize.
Cho Bong Hyun, the deputy director of IBK Economic Research Institute further commented that, “the regime seems to be distributing large amounts of imported rice to placate the population, but there are issues with the sustainability of this practice. Unless the total volume of incoming rice remains steady, the price declines seen will not be sustained for long.”
Full article:
Rice prices fall to 3500 KPW per kilo due to harvest season and import spike
Seol Song Ah
Daily NK
2016-11-07
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North Korea imports large quantities of rice in September: VOA

Thursday, November 3rd, 2016

Benjamin Katzeff Silberstein 

Via Yonhap:

North Korea imported the largest-ever amount of rice from China on a monthly basis in September since the launch of the Kim Jong-un regime in 2011, in an apparent bid to stabilize prices, a U.S. broadcaster, monitored here, reported Thursday.

North Korea imported 18,477 tons of rice and other grains in September, the Voice of America said, citing an analysis of data from China’s General Administration of Customs by Kwon Tae-jin, director of East Asia research at GS&J Institute in South Korea.

The September figure was about 2.7 times higher than 6,954 tons imported in October and about six times higher than 3,158 tons imported a year ago in September, the broadcaster said.

In particular, the North purchased 16,000 tons of rice from China in September, a monthly high since the start of the Kim Jong-un regime, and higher than the 14,000 tons imported during the first eight months of this year total, the broadcaster said.

Experts opined that the step is designed to stabilize rice prices at a time when the stock has hit its bottom, the broadcaster said.

“This is the time when the harvest is around the corner, and the stock is nearly exhausted,” Kwon said.

Full article:
N. Korea imports rice on large scale in Sept.
Yonhap News
2016-11-03

Discussions such as these are always complicated by the fact that for most regions, private market supply is probably far more important than whatever the PDS supplies.

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The problem with the Red Cross narrative of North Korea’s floods

Wednesday, October 5th, 2016

By Benjamin Katzeff Silberstein

I had originally intended to use this post solely to encourage readers to check out this story by the International Federation of Red Cross and Red Crescent Societies Asia Pacific. But as I was reading through the story, I realized there are several issues with it that need to be pointed out. It offers a comprehensive narrative of this year’s flooding in northern North Korea, which has devastated parts of North Hamgyong province. The photographs add a crucial human dimension to the ghastly figures for the damage. But unfortunately, the IFRC casts blame in all the wrong directions and fails to point out the core of the problem.

First, the key passages of the piece:

On August 29 the rains began. They continued for the next two days, swelling the Tumen river as it coursed along the northeast border of the Democratic People’s Republic of Korea (DPRK).  The heavy downpour was a consequence of the tail end of Typhoon Lionrock which had collided with a low pressure weather front as it tracked across China.  In just 24 hours up to 300 mm of rain fell over parts of DPRK’s North Hamgyong Province.

Streams of water flowed down barren mountains. They merged in ravines to become raging torrents of water – flash floods – which carved through rural communities in the valleys below, demolishing everything in their path.  The River Tumen also burst its banks, swallowing entire settlements in the dead of night.

The floods are considered to be the worst in decades yet this has been a silent disaster, largely unnoticed outside DPRK.  Hundreds of lives have been lost and the scale of devastation has been immense.

Now, one month on, the full extent of what happened is still emerging. According to the government some 30,000 homes have been damaged, submerged or completely destroyed and 70,000 people rendered homeless.

[…]

For days villages across Musan and Yonson Counties remained cut off as thousands of rescuers were mobilised to the area to repair roads and bridges and remove the earth and rocks deposited by landslides.

In the Sambong Bo area of Musan County,  the water level of the River Tumen had risen by over four metres in a matter of hours. When it broke its banks 500 homes were swept away.  At least 20 other communities further along the river suffered the same fate. It is still not clear how many died.

Reaching the flood-affected area requires a three-day drive from the capital Pyongyang but it only took 24 hours for the DPRK Red Cross to mobilize over 1,000 of its volunteers from the area to respond to the disaster. They supported local authorities in search and rescue efforts and also provided first aid services to the injured. Trained disaster response teams were deployed and within days emergency relief supplies for 28,000 people had been released from the Red Cross regional disaster preparedness stocks which were stored in warehouses in South Hamgyong and Pyongyang.

Items such as tarpaulins, tents and tools to make emergency shelters were distributed to flood-affected families. People also received other essentials such as warm bedding, kitchen sets, water containers and toiletries.

[…]

But there are other vulnerabilities. According to the UN, North Hamgyong Province has some of the highest levels of stunting and wasting among under five children. The Public Distribution System, upon which 78 per cent of the population of the province relies, is well below target levels (300 grams compared to the target of 573 grams) and not sufficiently diverse to cover nutritional requirements.

The floods damaged over 27,000 hectares of arable land. The rice and corn were ready to be harvested but now, many families’ food has been washed away along with crops, livestock and food gardens.

To make matters worse, more than 45 health clinics have been damaged by floodwaters and there is a critical shortage of basic equipment and essential medicines. Water supply to 600,000 people across the province has been disrupted and for clean water, some communities are now dependent on a few hand pumps and dug wells, which are most likely contaminated by the floods.

On 21 September, the IFRC launched a 15.2 million Swiss Francs emergency appeal (USD 15.5 million, Euros 13.9 million) to reach more than 330,000 people affected by the floods.

The appeal aims to provide a variety of emergency assistance over the next 12 months. Emergency water supply will be installed and teams will be mobilised to avert communicable diseases by improving sanitation and promoting good hygiene. Medical supplies will be provided for health teams on the ground and technical support provided to help with the reconstruction of permanent homes.

The appeal will also be used to purchase winterization kits that will help thousands of families through the hardship of the coming months. These include supplies of coal for heating and cooking, toiletries, winter clothes and quilts, basic food stocks and water purification tablets.

But according to Chris Staines international help needs to scale up.

“This is a disaster on a scale that that no-one seems to have acknowledged. When you add up all the threats that people are facing today in DPRK there is a very real risk of a secondary disaster unfolding in the months ahead if we don’t get the help that is needed immediately”.

Full article here:
Suffering in Silence
IFRC Asia
Shorthand Social
2016-09-29

Undoubtedly, this is a tragedy on a scale that is difficult to fathom even with the accompanying pictures of some of the devastation. Readers who wish to donate to the IFRC disaster relief efforts can do so here.

But the narrative lacks a crucial component, namely the government’s responsibility in disaster management and prevention, and the connection between the economic system and North Korea’s recurring floods. Now, readers familiar with the North Korean NGO context will be well aware that this is a sensitive political topic that NGOs and aid organizations are often reluctant to discuss, for good reasons. They depend on maintaining good relations with the North Korean government in order to continue operating in the country, and these relations are sensitive at best.

That said, the way in which the IFRC narrative seems to fault only one party — the international community, for not giving the disaster more attention — is strange, to say the least. For it is not the international community that has created the systemic deficiencies that contribute to making floods a yearly recurring phenomenon. Rain clouds do not gather only over North Korea. Anyone who has spent late summer and fall in South Korea will be familiar with the torrential rains that sweep across the country on the same regular basis that they hit North Korea. And yet, we never hear about human suffering and disasters in South Korea on an even comparable level with those that hit North Korea. Some landslides tend to happen, and sometimes the rains even claim lives. But they do not paralyze whole regions of the country and they do not cause humanitarian disasters on the southern side of the border.

The reasons that North Korea is hit with such particularly great damage from the rains, year after year, largely stem from its economic system. To name only a couple of examples: trees have been felled en masse due to a lack of fuel, causing erosion as not enough trees are left to suck up the rainwater, and the population has had to resort to clearing hills from trees to generate more farmland, particularly during the “Arduous March” of the 1990s. Moreover, in command economies, quotas for both wood and food need to be filled no matter what methods have to be employed — I am unable to find a source for the historical evolution of tree felling in North Korea prior to the 1990s, but most likely, such a logic has also contributed to the barren hillsides around the country. To be fair, Kim Jong-un has focused a great deal of attention on reforestation, which is arguably one of the most important but least noted policy focuses during his tenure. But thus far, not much seems to have happened in practice.

Barren and eroded hillsides in Namyang, North Hamgyong Province, as seen from Tumen City in China, June 2016. On the Chinese side, the equivalent hills are covered with trees. Photograph by Benjamin Katzeff Silberstein

Barren and eroded hillsides in Namyang, North Hamgyong Province, as seen from Tumen City in China, June 2016. On the Chinese side, the equivalent hills are covered with trees. Photograph by Benjamin Katzeff Silberstein

So: on the one hand, the IFRC may well be right that coverage of North Korea’s humanitarian disaster should render more media coverage. But on the other hand the late summer floods are such a regular occurrence that they should hardly count as news anymore. NGOs and aid organizations need to air on the side of political caution in their dealings with the North Korean regime, but their failure to call out the government for not rectifying the problems causing the damage in the first place may well be doing more harm than good in the long run.

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North Korean food prices after the floods

Wednesday, September 28th, 2016

By Benjamin Katzeff Silberstein

A recent report by Radio Free Asia/Asia Press (and recapped below by Yonhap) claimed that food prices had doubled in northern North Korea as a result of the floods last month:

Food prices in North Korea’s northeastern region, which has been hit by devastating floods, have doubled due to the slow pace of recovery and poor distribution networks, U.S.-based media Radio Free Asia (RFA) reported Thursday.

Citing a report by Japanese media outlet Asia Press, the RFA said the country’s northern cities of Hoeryong and Namyang are experiencing a spike in rice and corn prices which soared to 8,000 won (US$7.24) and 2,000 won per kilogram, respectively, from 4,300 won and 1,000 won before the worst-ever floods in decades. The flooding caused severe property damage with many people being reported dead or missing.

The Japanese media said there is a likelihood that other commodity prices will likely soar following rice.

Jiro Ishimaru, who heads the Osaka office of Japan’s Asia Press, told the RFA that rice prices rose rapidly as the transportation situation in the flood-damaged area is very serious, with the railroads and overland routes being almost blocked. The official said the lack of transportation means is leading to poor distribution of food and commodities.

Ishimaru, in addition, warned that water shortage and sanitary problems will also follow due to a shortage of personnel equipment needed to speed up recovery.

Full article here:
Food prices in N. Korea’s flood damaged area doubles: report
Yonhap News
2016-09-22

According to DailyNK, the government has therefore started implementing price controls to keep the market prices for food from skyrocketing:

북한 당국이 ‘60년 만의 대재앙’ 수해 피해를 입은 함경북도 지역의 물가 안정을 위해 총력을 기울이고 있는 것으로 전해졌다. 인민보안성(경찰) 인력을 동원해 쌀 사재기와 가격 인상을 통제하면서 내부 안정화를 꾀하고 있다고 소식통이 알려왔다.

함경북도 소식통은 27일 데일리NK와의 통화에서 “현재 쌀 가격 등이 큰물 피해 이전과 거의 차이가 없다”면서 “보안원과 순찰대가 출동해서 쌀 사재기 및 가격을 올리는 행위 등을 강력하게 막았다”고 전했다.

소식통은 이어 “(수해가 일어나고 얼마 되지 않아) 어떤 장사꾼은 1킬로(kg)에 5000원, 5300원하던 쌀을 8000원에 팔려고 하기도 했다”면서 “하지만 보안원들의 통제 때문에 눈치만 보다가 그렇게 하지 못했다”고 설명했다.

그러면서 소식통은 “회령시의 경우 한때는 쌀 가격이 6000원까지 폭등하기는 했으나 지금은 5000원 대로 하락했다”면서 “돼지고기 가격도 1kg에 13000원 등 원래 가격과 같다. 물가가 전반적으로 차분하다(안정돼 있다)”고 덧붙였다.

Full article:
North Korea making efforts for price stability in flood damaged areas…”Don’t raise rice prices”
Kang Mi-jin
Daily NK
2016-09-29

Yonhap offers a summary of the article in English:

North Korea is going all out in blocking the cornering and the skyrocketing of rice prices in its flood-devastated northeastern areas, a Seoul-based news outlet specializing in the North reported Wednesday.

This summer, six areas in North Hamkyong Province in the North were devastated by heavy rains accompanied by Typhoon Lionrock, with the United Nations having estimated that 138 North Koreans were killed and 400 others are missing by the floods, with about 20,000 houses destroyed.

“Security agents and patrolmen are strongly cracking down on activities of cornering rice and raising rice prices (in flooded areas),” the Daily NK quoted a source from the North’s North Hamkyong Province as saying.

Therefore, there’s no big difference in rice price before and after the worst-ever flood hit the region, the source said.

“A merchant was trying to sell 1 kilogram of rice at 8,000 won shortly after heavy rains flooded the area, but was unable to do so due to strict control by security agents,” the source said.

Rice price once soared to 6,000 won from 5,000 won per kilogram before the floods, and now remains at the 5,000 won level, according to the source, adding that pork prices also showed no noticeable change, selling at 13,000 won per kilogram as before.

“Prices in the deluged areas are stable, in general,” the source said.

Full article:
N.K. strongly controls prices in flood-stricken areas
Yonhap News
2016-09-28

Several things are worth noting here. First, historically, it is common for food prices to rise as a result of seasonal flooding in North Korea. After the severe floods in 2012, rice prices shot up from 4866 won/kg in July to 6533 won/kg in late September. Second, the rise in prices reported by RFA/Asia Press might have been a temporary shock. The DailyNK price graph, last updated in early September, shows very moderate increases in prices after the floods hit in late August. Perhaps prices stabilized quickly as supply did (i.e., deliveries coming in from other areas; this is only speculative though). Third, price controls are difficult to maintain under pressure. Had there been a massive pressure for prices to go up due to drastically decreased supply, it is hard to see that the government would have been able to effectively keep market prices at a certain level across the board. I will try to keep this post continuously updated as market price information gets updated.

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(Updated) Severe flooding in northeastern North Korea: pictures (summer 2016 floods)

Friday, September 2nd, 2016

By Benjamin Katzeff Silberstein

Larger-than-usual seasonal rains has caused flooding in several cities along the Sino-Korean border. Emergency evacuations have been issued in Tumen and Hunchun on the Chinese side. On the North Korean side, Namyang, a small town in Onsong county, has been struck by unusual flooding. DailyNK explains:

Flooding in North Korea typically occurs near the West Sea, not near Namyang, which is located in Onsong County, North Hamgyong Province. In areas like Sinuiju, downpours during the rainy season coupled with high tide in the West Sea are known to drive up the water levels of Amnok (Yalu) River and lead to flooding; however, such an occurrence is rare in areas adjacent to the Tumen River, particularly in the hillside city of Namyang.

As is usually the case in North Korea, flooding impacts are exacerbated by environmental factors related to the economy and food production:

It is therefore believed that unusually heavy rain, which battered the greater northeast region, contributed to the flooding, and was likely exacerbated by the use of embankments as small plots to grow produce by local residents, whose livelihoods depend on doing so. Weeding and digging around this area in order to plant beans and other crops is thought to have compromised the strength of the river banks, yet no preventative measures were put forth by the authorities.

DailyNK has a few pictures of Namyang taken from the Chinese side, showing flooding and destruction.

Full article in DailyNK:
Severe flooding sweeps across Namyang
Kim Ga Young
DailyNK
2016-09-02

For reference and comparison, the following pictures I took earlier this summer show Namyang in ordinary times (click for larger pictures):

Namyang1

Namyang city, Onsong county. Photo: Benjamin Katzeff Silberstein

Namyang2

Namyang city, Onsong county. Photo: Benjamin Katzeff Silberstein.

Namyang, Onsong county. You can see the train station to the right in the picture. Photo: Benjamin Katzeff Silberstein.

Namyang, Onsong county. You can see the train station to the right in the picture. Photo: Benjamin Katzeff Silberstein.

 

 

 

 

 

 

 

Namyang4

Namyang city, Onsong county. Photo: Benjamin Katzeff Silberstein.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Update 2016-09-04): At least ten people have died in North Hamgyong province as a result of the floods, Voice of America reports (in Korean):

국제적십자사 IFRC가 큰물 피해를 입은 함경북도 지역에 긴급구조팀을 파견해 구조활동을 펼치고 있다고 유엔이 밝혔습니다.

타판 미슈라 주 북한 유엔 상주 조정자 겸 유엔개발계획(UNDP) 상주대표는3일 북한 내 유엔 기구들과 비정부기구 관계자들에게 보낸 이메일에서, 태풍으로 인한 북한 홍수 피해가 예상보다 훨씬 심각한 것으로 파악되고 있다며 이같이 밝혔습니다.

‘VOA’가 3일 단독으로 입수한 이 이메일에 따르면 이번 폭우로 함경북도 지역이 가장 큰 피해를 입었으며, 특히 회령시과 문산군, 연사군, 청진시, 김책시, 경송군, 길주군, 라선시 일대에 큰 피해가 발생했습니다. Summary in English (by NKEconwatch): according to Tapan Misura, UNDP country representative in North Korea, North Hamgyong province has been struck by flooding in the past few days, to a much worse degree than expected. Especially Hoeryong, Musan, Yeonsan, Chongjin, Kimchaek, Kyeongseong, Kilju and Rason have taken strong hits.

또 홍수로 10여 명이 사망하고 1만 여 가구가 피해를 입었으며, 6천7백여 가구가 파괴되고 7천가구가 파손된 것으로 알려졌다고 미슈라 상주대표는 밝혔습니다. Summary in English: As a result of the flooding, ten people have died, about 10,000 homes have been damaged, 6,700 homes have been destroyed and another 7,000 homes have been broken/damaged.

[…]

특히 함경북도 회령시의 피해가 심해 가옥 2천개 이상이 물에 잠기고 1천개 이상의 집이 완전히 파괴됐다고 밝혔습니다. 또 적어도 2만6천여 가구가 식수도 없이 고립된 상황이라고 밝혔습니다. Summary in English: destruction has been particularly heavy in Hoeryong in North Hamgyong, where 2,000 houses have been submerged in water, and over 1,000 houses have been completely destroyed. Moreover, at least 26,000 households now lack access to drinking water.

미슈라 상주대표는 함경북도 일대에 지금도 계속 비가 내리고 있고 앞으로 며칠 간 비가 예보돼 있어 피해가 더 늘어날 것으로 보인다고 말했습니다. Summary in English: According to Misura, rain is continuing to fall in North Hamgyong, and will do so over the next few days, so the destruction is expected to grow.

Full article here:
유엔 ‘북한 함경북도 등 홍수로 큰 피해…10여명 사망’
Kim Hyeon-jin
Voice of America
2016-09-04

Korean Central News Agency reports some estimated figures on the destruction:

It rained heavily with strong wind in North Hamgyong Province and other parts of the DPRK from August 29 to September 2, affected by a combination of typhoon-10 and low pressure field formed in the northwest.
According to data available at the State Hydro-meteorological Administration, the rainfall reached 320 mm and 290 mm in Kyonghung and Puryong counties of North Hamgyong Province from 00:00 Monday to 12:00 Friday.
And over 150 mm of rain fell in Onsong, Kyongsong, Kyongwon, Yonsa and Hwadae counties of the province as well as some parts of Ryanggang Province including Taehongdan County.
The River Tuman flooded some areas of Hoeryong and Rason cities, Musan, Onsong, Kyongwon, Kyonghung and Yonsa counties, causing big damage.
Especially, flood heavily hit Hoeryong City, Musan and Yonsa counties, claiming 15 people missing in Hoeryong.
17 180 houses were partially or completely destroyed with at least 44 000 people homeless in North Hamgyong Province.
Damage investigation goes on there.
And a campaign to help victims and heal the damage is being conducted in the flood-stricken areas.

Full article:
North Hamgyong Province of DPRK Suffered from Flood Damage
Korean Central News Agency
2016-09-03

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