Vegetable prices rise: ripple effect of sanctions

[As Heard in North Korea]
Unification Media Group  |  2017-06-12 16:35

"As Heard in North Korea" articles contain radio programming content broadcast by Unification Media Group [UMG], an independent multimedia consortium targeting North Korean citizens.

Vegetable prices are continuing to rise during North Koreas so-called farm hardship period, causing difficulties for ordinary residents struggling to put food on the table. For more details, we turn to economic correspondent Kang Mi Jin.  
 
The farming hardship period refers to the time that spans the beginning of seed-planting in early May to the first harvest of spring potatoes in mid-June. Every year, the vegetable prices will generally fall thereafter in the summer, coming as something of a respite to the beleaguered residents. 

However, it appears that international sanctions placed on the Norths leadership are beginning to have a tangible effect this year, and the cost of certain goods has jumped. For example, vegetables that were considered affordable last year have been subject to price rises, with no signs of respite coming anytime soon. 
 
What are the vegetable prices like now?  
 
If we take Chongjin Market in North Hamgyong Province for example, we can see that cabbage rose to 6,000 KPW, which is cheaper than cabbage grown in greenhouses, but still 3,000-4,000 KPW more expensive than the same cabbage in the markets at this time last year. Families that are struggling typically turn to vegetables like cabbage to supplement their diets. To cope with the price rise, some residents are even travelling to rural areas to purchase at more affordable prices. 

Cabbage is not the only product to rise in price. A lot of other daily necessities have also gone up, and residents are of course sensitive to these price fluctuations. 

What vegetables are the residents having to turn to in response?  
 
In general, people tend to eat water parsley, cabbage, spinach, lettuce, cucumber, tomato, and crown daisy. Spinach is blanched in boiled water, similar to the way its prepared in South Korea. 
 
Lettuce is also prepared in a similar way to how South Koreans do it, as a wrapping. And there are numerous varieties of lettuce available, including blue lettuce and a crossbred variety called cabbage-lettuce.  
 
In South Korea, people tend to consume vegetables for health reasons, but in North Korea, the poorer families see them as necessary to bolster their meager nutritional intake. Cabbage is grown in greenhouses in March and April, and in some regions cabbage imported from China is also available for purchase. 
 
Why do you think prices have risen compared to last year? 
 
Our sources believe that the international sanctions are responsible for the price rise. Word about the strongest sanctions to date is circulating around the markets and prices are rising across the board. Gasoline and diesel prices are also shooting upwards, and this is having pass-through effects on other products as well.  
 
If we piece together the various sources of information we have on prices in North Korea, we see an upwards trend when compared to the cost of goods at the same time last year. One kg of spinach has gone from 600 KPW to 700 KPW, and one kg of squid has climbed from 6,500 KPW to 7,000 KPW.  
 
One kg of corn was selling for 1,700 KPW until recently, but is now hovering around 2,000 KPW. A price increase of this type usually causes residents to purchase more veggies, but even those costs have gone up, making it harder to buy enough food to sustain a family.  
 
Despite this, the authorities are doing little to address the situation. Instead, they continue to focus their efforts on money-making schemes like distributing pine mushroom alcohol, considered a luxury item with one bottle costing as much as a kilo of rice (5,000 KPW). 
 
Prices have been stable until recently, although the stronger international sanctions have been in effect for about a year. Why do you think the sanctions are suddenly starting to have an effect now? 
 
Since Kim Jong Un came to power, price rises have arisen due to seasonal variation and crackdowns by the authorities. In general, market restrictions have not been very frequent in the Kim Jong Un era. So the introduction of stronger sanctions did not seem to cause much concern early on. Residents felt that the economy was more or less unaffected.  

But the situation is different now. Residents are now becoming acutely sensitive to the idea of sanctions. Because of the new restrictions in place, the flow of products coming over the Chinese border through customs has reduced, impacting the ability of merchants to sell imported goods in the local markets. The supply issues have pushed up prices. 
 
These days, as soon as rumors begin to circulate among traders and vendors that customs is restricting an item, market prices tend to rise. In other cases, wholesalers are simply unable or unwilling to sell certain goods to merchants for retail. 

*Edited by Lee Farrand

 
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2017.06.09
Won Pyongyang Sinuiju Hyesan
Exchange Rate 8,010 8,000 8,070
Rice Price 5,250 5,305 5,130