State factories fail to dent consumer demand for S. Korean bread

[As Heard in North Korea]
Unification Media Group  |  2017-02-23 18:02

"As Heard in North Korea" articles contain the content of Unification Media Group [UMG] radio broadcasts into North Korea. UMG is a consortium created by Radio Free Chosun [RFC] and Open Radio for North Korea [ONK], shortwave radio stations targeting North Korea; The Daily NK, an internet periodical reporting on all aspects of North Korea; and OTV, an NGO-based internet television channel.

A new expression has emerged in South Korea to explain the increasing phenomenon of people eating alone. In addition, lots of people are foregoing traditional breakfast foods in favor of grabbing some bread and milk on their way to work. Today, were going to talk about the rise of bread culture in North Korea with Reporter Kang Mi Jin. Thank you for joining us.  

Thats right. People are consuming more and more bread these days in the South. And according to a recent conversation I had with a contact in North Korea, bread is selling quite well in the markets over there as well. Vendors have been quick to recognize and respond to this trend. A number of trading companies have recognized the surging demand and made contracts with Chinese companies to enter the baking industry. 

When I was in the North, I was actually involved in the bread market for seven or eight years. I ate so much bread at the time that I dont have much of an appetite for it anymore. Whenever I went on a trip or worked in the fields, I was sure to put some bread in my lunchbox. Today, were going to dig a little deeper into the changing tastes of North Korean consumers.  

Let's jump right into it. Please tell us a little more about the latest trends.

According to sources inside the country, the number of North Korean consumers buying bread in the jangmadang [marketplace] is rising. Hearing this, I realized that tastes have changed quite a bit over the years. More people have become involved in the markets as a response to the increased marketization of the country as a whole. That has made them more mobile. Bread is also rising in popularity as a lunch food offered by the authorities at official events. The demand for bread is especially high when the weather is cold. For those who are on the move or enduring the cold weather, bread is usually better than cold rice.  

In South Korea, there are a number of specialty bakery stores. These businesses usually obtain a license from the government to operate, or are part of a franchise. How does it work in North Korea? 

In North Korea, some individuals make their own bread while some businesses sell bread produced in specialty factories. The specialty factories are acknowledged by the authorities, so you might look at this as a form of certification. However, the merchants who sell bread baked in their homes dont have any sort of license. Despite this, the homemade bread tends to sell quickly in the marketplace. 

If this kind of infraction were to happen in South Korea, the business would be in trouble and subject to fines. But thats not the case in North Korea. People in the North even make and sell their own alcohol. Snacks and candies are also made and sold without a license.  

You spoke before about traders importing bakery products from abroad. Weve heard that this even includes South Korean products. Is that true? 

Yes, some of the richer North Koreans are adding to the demand for bread produced in South Korea. According to a source that I contacted recently, wholegrain bread and brown bread from South Korea are becoming particularly popular. One resident conducting business in China was surprised to discover that the types of bread they were importing were wholegrain bread and chocolate muffins. 

Of course, this trend of eating bread in Asia did not originate in South Korea. It came from the West initially. But bread became a hit in the South, and North Koreans watching Hallyu [South Korean cultural wave] dramas and movies picked up on the trend. It is a sign that in addition to affecting fashion and movies, Hallyu is even influencing culinary culture in the North.  

In relation to this spike in demand, North Korean state-run enterprises have been storming into the bakery industry. Despite these attempts, the state-run factories have failed to produce popular products. Donju [North Koreas new monied class], traders, and even cadres all admit that South Korean-produced bread is the best. South Korean bread is even being distributed to department stores and markets. In cases where its absent, traders ask their Chinese contacts to supply it. 

Thats quite interesting. The influence of Hallyu has spread to food culture. Can you tell us how much this bread costs in North Korea? 

We got some information on bread prices in Pyongyang. At the Independence Department Store on Independence Road, a five pack of wholegrain bread produced at the KumCup Food Factory sells for 19,000 KPW. Thats about 4,000 KPW for one unit of bread. That means that a single bag of bread costs the same as 4 kilograms of rice. So this kind of bread is too expensive for most ordinary people.   

However, even North Korean cadres think that bread produced in the North is lacking in flavor. Unfortunately, we werent able to ascertain the price of South Korean bread in time for the publication of this story, but we do know that demand is high.

You mentioned earlier that residents who work at the markets also enjoy bread. Im curious about what kind of bread they like to eat. 

Merchants are always on the go. Thats why they usually have some bread in their lunchboxes. Since theyre unable to afford the expensive bread that I told you about earlier, these runner merchants usually prefer to buy bread in the markets thats essentially homemade. There are two types available, dry bread [like a biscuit] and steamed buns. The merchants choose to sell whichever one they prefer. 

One kilogram of bread costs 6,350 KPW. This makes it a little more expensive than rice, but not too burdensome. The homemade bread is produced from scratch and even fermented in the home, so it has more flavor than the factory produced stuff. Thats why its more popular. Theres also a kind of bread that costs 1,000 KPW - which is a hit with college students living in the dorms. 

Thank you for that report on the latest culinary trend in the North. We'll close with the latest market prices, updated as of February 9.

In general, weve seen prices rise all around the country. One kilogram of rice was 4900 KPW in Pyongyang, 4780 KPW in Sinuiju, and 5050 KPW in Hyesan. One kilogram of corn was 1400 KPW in Pyongyang, 1470 KPW in Sinuiju, and 1500 KPW in Hyesan. Rice prices rose 400 won from last week in Pyongyang and 350 won in Hyesan and Sinuiju. Corn prices rose by 200 won in Pyongyang and 170 won in Sinuiju. 

Now for the exchange rates. The USD was trading at 8030 KPW in Pyongyang, 8020 KPW in Sinuiju, and 8095 KPW in Hyesan. The yuan was trading at 1205 KPW in Pyongyang, 1175 KPW in Sinuiju, and 1184 KPW in Hyesan. One kilogram of pork was selling at 19,000 KPW in Pyongyang, 17,500 KPW in Sinuiju, and 21,000 KPW in Hyesan. One kilogram of gasoline was selling at 8090 KPW in Pyongyang, 8170 KPW in Sinuiju and 8300 KPW in Hyesan. One kilogram of diesel oil cost 5500 KPW in Pyongyang, 5600 in Sinuiju and 5850 KPW in Hyesan.

*Edited by Lee Farrand

 
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2017.06.28
Won Pyongyang Sinuiju Hyesan
Exchange Rate 8,070 8,050 8,095
Rice Price 5,800 6,000 5,900