Archive for the ‘Agriculture’ Category

Effort to prevent outflow of capital into markets

Friday, March 20th, 2015

Institute for Far Eastern Studies (IFES)

Since the start of the Kim Jong Un era, North Korea has introduced elements of a market economy while at the same time sought ways to mitigate the side effects caused by the rapid spread of market mechanisms.

The Choson Sinbo, mouthpiece of the General Association of Korean Residents in Japan (also known as Chongryon), revealed on February 22, 2015 that on a number of cooperative farms there are now ‘purchasing sites’ where farmers can barter and exchange goods. The newspaper explained that “[On the cooperative farms] there are purchasing sites where cheap goods are displayed and farmers are able to trade distributed agricultural products […] Through these sites it can prevent farmers from liquidating their produce and thus prevent funds from flowing into the market.”

Through the introduction of the ‘field responsibility system,’ North Korea has reportedly been able to meet demand for daily necessities at these purchasing sites. The state controls these sites in order to prevent farmers from taking goods to the jangmadang or the market when the surplus, which returns to the farmers, increases. Since entering the Kim Jong Un era, the field responsibility system has been expanded throughout the country and is credited with having contributed to North Korea’s increase in agricultural production. The system divides the bunjo (the small production teams on the cooperative farm) into family-sized units of 3 to 5 people and entrusts these units with the work of cultivating small-sized fields.

A system similar to the purchasing sites of the cooperative farms can be found in the city as well. The Choson Sinbo revealed that “[North Korean factories] are purchasing items like food and basic commodities produced in the country and are distributing them to workers as a portion of their wages.” In the years following Kim Jong Un’s rise to power, wages increased exponentially due to the introduction of incentives and the increase in the autonomy of factories and businesses. But because the threat of inflation becomes significant if those increased wages are paid entirely in cash, it is reported that businesses pay a part of workers’ wages in goods and commodities.

The Choson Sinbo added that the ‘Hwanggumbol Shop,’ a convenience store that has been appearing here and there in Pyongyang since December of last year, is also an effort by the state to prevent the rapid expansion of the market. The newspaper explained that the state-operated store focuses on supplying “cheaper prices than the market” and that the goal of the store is to guarantee “the circulation of money through state-operated stores.”

State-operated stores are an attempt to prevent the market from taking a central place in the circulation of money. This is accomplished by having state-run stores supply goods at a lower price than the market and thereby attract consumers. Different from the past, the current regime intends to utilize the market rather than restrict it. It is believed that North Korea will try to keep the market in a condition in which it can be suitably managed.

Share

South Korea to help develop fish farms in DPRK

Tuesday, March 17th, 2015

According to Yonhap:

South Korea, together with the U.N. Food and Agriculture Organization (FAO), plans to help develop fish farms in North Korea as an aid to the impoverished state, the government said on March 17.

According to the Ministry of Oceans and Fisheries, the Korea Maritime Institute will soon sign an agreement with the FAO to launch a joint study on the fish-raising industry in the North.

The two parties will study climate conditions in North Korea and find the best species for farming, and based on the outcome of the study, South Korea and the FAO will raise a 30 billion won (US$26.5 million) fund to help build new fish farms in the North, the ministry said.

The aid, however, will likely be delivered by the FAO as Pyongyang continues to be at odds with Seoul over its nuclear program.

Inter-Korean dialogue has nearly come to a halt after the North’s third nuclear test in early 2013. The communist state continues to blast daily threats and slander against the South’s Park Geun-hye government.

South Korea’s National Red Cross had offered to send 25 tons of powdered milk for the malnourished children of North Korea last month, but Pyongyang quickly rejected the offer.

North Korea is believed to have suffered a chronic shortage of food since the late 1990s. The country continues to depend heavily on international handouts to feed a large portion of its population of 24 million, accepting nearly $20 million worth of international aid in the first half of 2014 alone.

You can read the whole story here:
S. Korea to help develop fish farms in N. Korea
Yonhap
2015-3-17

Share

Kim Jong-un’s speech on animal husbandry

Friday, February 27th, 2015

North Korean media reports that on January 28, 2015, Kim jong-un delivered a speech to senior officials of the party and state economic agencies titled, “Let Us Expedite the Construction of the Livestock Farming Base in the Sepho Area and Bring about a New Turn in Developing Animal Husbandry”.

The western media that reported on the speech primarily latched onto a phrase used a the beginning where Kim Jong-un admitted to problems sleeping at night when he thinks about his people:

Whenever I am reminded of my failure to provide a rich life to these laudable people, who, in spite of their difficult living conditions, have firmly trusted and followed only our Party and remained faithful to their pure sense of moral obligation to the great Comrades Kim Il Sung and Kim Jong Il, I cannot get sleep.

The majority of the speech, however, focuses on the development of the Sepho Tableland Stock-breeding Project. It does not appear to be going well. Kim opens with these optimistic words:

This is the first time for our country to create pastures covering tens of thousands of hectares and build a large-scale livestock farming base. Though they are inexperienced and many things are in short supply, the builders of the large-scale livestock farming base in the Sepho area are creating miracles and innovations to the wonder and admiration of all by giving full play to the fighting spirit of self-reliance and fortitude. The service personnel of the People’s Army and shock-brigade members, who have gone to the Sepho area in hearty response to the Party’s call, have created tens of thousands of hectares of pastures in a short period, taking up the challenges of Nature, and overfulfilled the last year’s target of grass production. Great successes have also been achieved in the road work and the construction of dwelling houses, animal sheds, public buildings and other structures.

Following these words, however, is a cascade of complaints and problems he wants resolved: Shortages of supplies for workers, poor soil, unsuitable grass for animals, strong winds, shortage of capital for investment in buildings, transport and production. There are also shortages of livestock, livestock feed, and technicians.

Kim then moves onto other problems with the nation’s livestock breeding enterprises.  He states:

We should normalize production at the modern livestock farming bases built under the Party’s leadership. […] several of them are not functioning properly because officials failed to take measures necessary for their normal operation after they were built.

So apparently many of the country’s livestock farms are incapable of turning out a regular [predictable] quantity of protein. Of course there is no data here, so we do not know if there is a problem with production or whether there is a problem with the production finding its way to official distribution channels. Either way, the Party Center is not pleased.

Kim Jong-un offered a laundry list of technological fixes to these problems:

“In order to develop livestock farming, it is necessary to solve the problems of animal breeds and their feed, improve the methods of raising them and take thoroughgoing veterinary and anti-epizootic measures.”

But little about enterprise management, or how it can be improved, is discussed in detail. For example Kim still officially believes that patriotism and propaganda campaigns can lead to sustained improvements in output:

“Party organizations at all levels, those in the stockbreeding sector in particular, should conduct a proactive political offensive to rouse officials and working people to carry out the Party’s line on animal husbandry. They should implant in their hearts the ennobling love for the people cherished by the General all his life, so that they will all turn out enthusiastically to carry out the Party’s policy. They should give wide publicity to the units and working people that do livestock farming with all consistency and enjoy benefits from it, and generalize their experiences.”

However, the speech was not entirely depressing from an economic perspective. Kim did reference private livestock farming as one option that could be encouraged to mitigate supply problems with the official agriculture sector:

“Private livestock farming at rural households should be encouraged. Every house teeming with domestic animals adds to the socialist rural scenery. Rural households should be encouraged to raise large numbers of pigs, goats, rabbits, chicken and other kinds of domestic animals so as to augment their income and enrich their lives.”

I have made a PDF of the entire speech and you can read it here.

Share

DPRK crop output in 2014

Friday, February 6th, 2015

Media sources report that North Korea experienced a surprisingly good harvest in 2014.

According to the Voice of America:

The GS&J Institute released a report based on statistics from the U.N.’s World Food Programme and Food and Agriculture Organization. Dr. Gwon Tae-jin, who spearheaded the research, wrote that the North harvested 4.98 million tons of crops in 2014.

The FAO recently announced that the North harvested about 5.94 million tons of raw crops last year. The figure from the GS&J Institute is based on how much would be left after processing the raw crops for consumption.

Gwon explained that while the figure is lower than the previous estimate because of the drought in spring, the autumn harvest made up for the lackluster yield earlier in the year.

The report indicated North Korea’s crop harvest plunged from 4.05 million tons in 1995 to 2.57 million tons in 2001. However, the food security situation has improved since 2004, staying around 4 million tons in most years.

In 2011, the figure rose to 4.22 million tons, and when Kim Jong Un became the country’s leader in 2012, it rose to 4.45 million tons. The next year, it was 4.84 million tons.

Gwon said Pyongyang’s efforts to draw manpower to farming and prioritize the distribution of fertilizer and other materials for agriculture is the main reason behind the hike in crop harvest. He added that the new policy of letting farmers freely use a certain percentage of the harvest had also helped the productivity.

In a telephone interview with VOA, Gwon said, “North Korea, which overcame difficulty with international aid in the early 2000s, is now in the process of overcoming another difficulty through its own efforts, rather than aid.”

Despite the slight improvement, however, the North Korean government is not able to meet the minimum needed for food security.

In 2007, when the crop yield was low, Pyongyang was able to feed its people through imports and international aid. From 2008 on, the country has experienced food shortages because of a decline in international aid.

The latest report forecast crop distribution in the North to be lacking by some 80,000 tons, when totaling its crop harvest, imports and international aid.

I have not been able to locate the original UN or GS&J reports (VOA-you should site your statistics, or even better, link to them).

The increase in agricultural production occurred at the same time as a nation-wide drought. Could this be the effectiveness of the 6.28 Measures?

Read the full story here:
Report: N. Korea’s 2014 Harvest Best Since Mid-’90s
Voice of America
2015-2-6

Share

UNFAO on DPRK food supply outlook

Thursday, February 5th, 2015

On February 3, 2015, the UNFAO recently published the DPRK “Outlook for Food Supply and Demand 2014/15“.

Here are the highlights:

1. After increasing markedly for three consecutive years, food production remained stagnant in 2014 with the aggregate output put at 5.94 million tonnes (including cereals, soybeans and potatoes in cereal equivalent). This figure comprises the official estimate of the 2014 main harvest and forecast for the 2015 early crops from cooperative farms, as well as FAO projections of production from sloping land and household gardens.

2. Paddy production dropped by about 10 percent due to reduced irrigation water availability, following low precipitation in the winter and dry spells during the 2014 main season. However, this decline was compensated by a significant increase in maize output, as a result of mass mobilization of people to water maize plants.

3. Production of the 2014/15 early season potatoes and minor wheat and barley crops, to be harvested from next June, is forecast to fall considerably.

4. The total utilization needs for the 2014/15 marketing year (November/October) are set by FAO at 5.49 million tonnes of cereal equivalent and the cereal import requirement is estimated at 407 000 tonnes. The Government is expected to import 300 000 tonnes of cereals, leaving an uncovered deficit of 107 000 tonnes for the current marketing year. This gap is larger than in 2013/14 partly as a result of revised post-harvest losses.

5. With a stagnant harvest in 2014, the food security situation in 2014/15 is likely to remain similar to that of the previous marketing year, with most households estimated to have borderline and poor food consumption rates.

The report listed these statistics that I thought were worth highlighting:

The marginal increase (0.3  percent) in the 2014/15 food production follows three consecutive years of strong growth at 4.4 percent in 2011/12, 8.7 percent in 2012/13 and 3.5 percent in 2013/14. However, at the forecast level, production remains above the past five-years average.

Andrei Lankov takes an optimistic view of this report in his article for Radio Free Asia and in the Carnegie Moscow Center. He credits implementation of the 6.28 Measures.

Marcus Noland commented on technical aspects of the report (such as the fact that the assessment was made without direct access to the country).

Scott Snyder commented on some of the political economy around the reports findings in Forbes. He asks why the UNFAO was not allowed into the DPRK, and notes that Russia has become the DPRK’s largest food donor.

The Daily NK has also noted the stability of food prices in late 2014 and early 2015.

Share

Kim Jong-un’s 2015 new year address

Thursday, January 1st, 2015

Martyn Williams has posted the best video of it (with English subtitles):

Here is coverage of the speech in the North Korean media (KCNA):

1. Kim Jong Un Makes New Year Address

2. Kim Jong Un Refers to Achievements Made by DPRK Last Year

3. Kim Jong Un Underlines Need to Consolidate Country’s Might as Socialist Political and Ideological Power

4. Kim Jong Un Calls for Fresh Turn in Building Revolutionary Armed Forces and Enhancing Defence Capability

5. Kim Jong Un Advances Tasks to Effect Upswing in Building Socialist Economic Giant and Civilized Nation

6. Kim Jong Un Set Forth Ways of Carrying out This Year’s Tasks

7. Kim Jong Un Deals with Issue of National Reunification

8. Kim Jong Un Deals with Issue of Foreign Relations

9. New Year Address Having Public Response

10. Workers and Farmers Meet to Vow to Implement Their New Year Tasks

Here is coverage of the speech in the international media:

1. N. Korean leader’s speech ‘meaningful': Seoul (Yonhap)

2. N. Korean leader’s speech arouses cautious optimism (Korea Herald)

3. Kim Jong-un says North Korea is open to ‘highest-level’ talks with South (Guardian)

4. Kim Jong Un Makes Apparent Summit Offer to South Korea (Wall Street Journal)

5. New Year’s Address Reveals a Nervous Leader (Daily NK)

6. Kim’s New Year’s speech reveals economic priorities (Lankov/NK News)

7. Jumping to Conclusions…Again (Klingner/38 North)

8. What’s New in Kim Jong Un’s New Year’s Speech (38 North)

9. Kim Jong Un’s New Year Speech: The Prospects for the 2015 Economic Policy (IFES)

10. Pyongyang’s ‘Year in Review’ Package Emphasizes Kim (Wall Street Journal)

Share

The third anniversary of Kim Jong Il’s death: Urging economic prosperity through economic development

Wednesday, December 31st, 2014

Institute for Far Eastern Studies (IFES)

This year marked the end of a three-year mourning period for Kim Jong Il’s death. To solidify Kim Jong Un’s rule, North Korea is urging for economic advancement and emphasizing economic prosperity and people’s happiness.

The Rodong Sinmun, the mouthpiece of the Workers’ Party of Korea (WPK), increased its economy related news content from December 17. The entire December 22nd edition featured news on economic development: the front page headline read, “Let Us Seize All the Battle Goals of This Year”; news highlighted the achievements of the country’s cement factories, thermal power plants, insulation factories, cooperative farms, mines, and other front-line industries. In addition, pages two and four introduced economic development plans about fisheries and medical supplies. It also featured news touting rural villages’ ability to resolve vegetable shortages by growing vegetables rather than lawn in yards and by planting persimmon trees in villages.

The December 20th edition featured news of Kim Jong Un’s field guidance to Kim Jong Suk Pyongyang Textile Factory — his first since the end of the three-year mourning period for his father. The factory is named after Kim Jong Un’s grandmother and is one of the DPRK’s major textile factories. Kim stressed the problem with production of school uniforms and said, “The Party will fully take charge of the issue of school uniforms, shoes, school supplies, and school bags.”

Prime Minister Pak Pong Ju’s visit to the Orangchon Power Station No. 2 in North Hamgyong Province was also reported. This power station is significant in terms legacy. It began with Kim Il Sung’s order to resolve the power shortage problem in the North Hamgyong region. Power Station No. 1 was completed in 2007 during Kim Jong Il’s era. Power Station No. 2 was completed during Kim Jong Un’s regime.

The reason for the increased emphasis on economic issues is likely the desire to earn public support and improve public sentiment toward Kim Jong Un for resolving the country’s economic problems.

Meanwhile, the Voice of Russia reported that DPRK’s grain production increased this year against the previous year, recording 5.71 million tons. The Russian news agency ITAR-TASS also reported this news, quoting a DPRK official from the Ministry of Procurement and Food Administration: “Despite the drought that we had this year, grain yield increased by 50,000 tons from last year at 5.71 million tons.”

This is the first official report released by DPRK authorities on yearly crop yield. It suggests that North Korea’s good harvest of last year continued with a good harvest this year.

Success in the agricultural sector is likely to lessen the burden of chronic food shortage, and Kim Jong Un’s various agricultural reforms are expected to gather momentum including “Punjo” farming management system, which involves the handing out of small plots of land, or “pojon,” to small sub-groups or sub-workteams, usually comprising a family unit.

Share

DPRK responds to drought

Saturday, December 20th, 2014

According to the Pyongyang Times (2014-12-20):

Nation set to secure enough water for farming

A long spell of severe drought that hit the country this year lowered the water level of reservoirs and reduced water sources for farming.

As part of the ongoing nationwide drive to meet the challenge and secure enough water for farming next year, cooperative farms in North Phyongan and South Hwanghae provinces are stepping up the repair and construction of reservoirs and waterways and their extension.

North Phyongan Province is focusing on the construction of reservoirs together with the reconstruction of Paengma-Cholsan and Amnokgang waterways.

Builders engaged in the reconstruction of Paengma-Cholsan and other waterways already rebuilt the waterway section in charge and are now laying stones over the surface of the banks.

The province is now carrying on the plans to build the reservoir at the Osong Cooperative Farm in Jongju till April and Hwangpho reservoir in Kwaksan County till June next year.

At the same time, it pushes ahead with the repair of 202 dams, about 600 pools, over 1 000 wells, some 90 tube wells and underground reservoirs to collect as much water as possible for the next year’s farming.

North Hwanghae Province is concentrating on the building of pumping stations to do safe farming by pumping up water from the Taedong River together with that of reservoirs.

After setting an ambitious goal to repair dozens of reservoirs, build dozens of more reservoirs, build and extend hundreds of kilometres of more waterways and construct more wells, tube wells and pumping stations on two stages till March next year, it is pushing forward with them in a planned manner.

Builders of Wangdang Reservoir No. 2 in Singye County are building earth dams successfully.

Songnim City is undertaking a project to draw water from the Taedong River into Inpho, Chongun and other ris. Notable achievements have been made in the building of foundations and waterways in a few days since it began.

The construction of pumping stations and waterways is under way in Hwangju County to draw water from the Taedong River into hundreds of hectares of paddy and dry fields of the Sunchon Cooperative Farm which was severely hit by drought this year and in Sariwon to use water of the Jaeryong River on the Migok Cooperative Farm.

Share

Agricultural development zone on grain-producing area

Friday, December 12th, 2014

According to the Pyongyang Times (2014-12-12):

The agricultural development zone is to be established on Yoltusamcholli Plain, the rice bowl in the west of Korea.

The zone covers an area of nearly three square kilometres in Unjong-ri of Sukchon County, South Phyongan Province in the heart of the plain.

It is envisaged that agricultural research and development bases will be built there in line with the trend of modern farming method as well as food and other processing bases.

The bases will be engaged in R&D for the breeding of good and high-yield varieties of rice, maize, fruit trees and silkworms, for seed selection and for the introduction of the seedling production system and organic farming, and in the production of organic fertilizers and agrochemicals, animal husbandry and processing of environment-friendly foodstuff.

The zone will also establish processing industries that make the most of natural resources and industrial establishments around the area.

The merits of the zone are that the county has skilled agricultural workforce in large numbers, educational and research institutes, favourable topography and the gravity-fed waterway nearby.

In the vicinity of the zone there are also roads linking Pyongyang with local areas including the western border city of Sinuiju, Sukchon Railway Station, Pyongyang International Airport and the country’s biggest trade port of Nampho.

Share

Rice price falling in DPRK

Friday, November 7th, 2014

According to the Daily NK:

Market rice prices have been dropping dramatically in recent days, the Daily NK has learned. Given reports of an unfavorable harvest due an absence of fertilizer and drought conditions early in the season, the news has come as a surprise to many residents. In turn, this has led to customary bouts of speculation and rumor.

“The price of rice has plunged to 4,500 KPW [0.54 USD] per kg in the markets,” a source in Pyongyang told the Daily NK on Thursday. “The harvest is underway and freshly harvested rice is pushing down prices.”

“This year, not only collective farms but also individuals planted a lot of rice,” he elaborated. “It seems like the rice from these private plots is now in the marketplace.”

As of mid-October, a kilo of rice was fetching 6,800 KPW [0.82 USD] in public markets, according to research conducted by the Daily NK in locations across North Korea. Later in the month it fell to 5,000 KPW [0.60 USD], and has now reached the 4,500 KPW [0.54 USD] mark.

“Rice is going for roughly 4,800 KPW [1.80 USD], and the price here continues to fall,” a source based in the isolated border city of Hyesan said. “People have been saying the harvest this year has not been that good, but there’s definitely a lot of rice in the markets now.”

The going rate for corn has also fallen in Hyesan, the source explained, dipping to 1,700 KPW [0.20 USD] in early September. The price of corn usually tracks that of rice.

Meanwhile, in Pyongyang residents eager to determine the cause of the sudden drop have been speculating “that rice from Russia has been brought in,” the source revealed. There have even been hard numbers floated in reference to the rumor. To wit, “The state requested 5,000 tons because of the bad harvest.”

The source in Hyesan explained that, as usual, “grain units” have been officially dispatched to oversee the distribution of the harvested rice, but that bribes are sufficient to keep them from regulating rice sold in markets.

The term “grain unit” refers to 20-30 members of the Worker and Peasant Red Guards, one of North Korea’s large reserve military forces consisting of men between the ages of 17 and 60 and some unmarried women, who set up checkpoints along main transportation routes in order to govern the movement of rice and corn harvested on collective farms and individual farm plots. However, this type of monitoring has long been an ineffective formality due to the prevalence of corruption.

Despite the brief spike surmised to stem from these factors, the fall in rice prices is not expected to last long. “There may be a lot of rice in the markets, but the harvest was bad so the supply will gradually decrease,” the source predicted. “Unless the state actively engages with the issue, prices will gradually climb back up to last month’s level.”

There is also the likelihood that vendors with rice in stock may decide not to bring out their supplies if the price stays low, hoping to stick it out and reap higher profits later. According to the source, “If this were to continue, the prices would continue to climb, potentially making things difficult for residents.”

Rice prices in the North tend to be affected by fluctuations in exchange rates, but more recently they have moved seemingly without regard for currency prices. Currently in Yangkang Province, 1 RMB [0.16 USD] trades for 1,350 KPW, a 50 KPW increase from September, yet the price of rice has actually fallen.

Read teh full story here:
Surprise Rice Price Fall on Harvest News
Daily NK
Lee Sang Yong
2014-11-7

Share