NK Harvest Improves on Procurement Price Bonus

North Korea’s staple food production for the agricultural year 2011-12 rose by around 10% compared to 2010-11, a new UN report released yesterday has revealed.

However, the report by the UN’s Food and Agriculture Organization and World Food Programme warns that the North is still facing a food debt of around 507,000 tons for the period to October next year.

Total staple food production for the year 2011-12 was around 4.9 million tons, it notes. It is a figure that will reduce fears of a difficult winter that arose after drought and flooding struck the country’s major agricultural areas in the spring and summer.

“Despite some flood damage in July-August to paddy crop in the main grain producing provinces, the timely availability of key inputs and an increase in the state procurement prices resulted in an overall increase in the main season crop harvest,” the report explains. “Furthermore, the impact of the prolonged dry spell in the first half of the season was largely mitigated by increased irrigation efforts including mass mobilization of people to water maize plants.”

As noted above, one cited reason for the improved yields is because the North Korean authorities offered improved procurement prices to farmers in the form of a bonus, effectively raising the price of barley by 56%, corn by 50%, wheat by 45%, and rice by 34%. Procurement prices for potatoes and soybeans rose by far less, just 13% for potatoes and 10% for soybeans, and total yields for those crops did not rise substantially, it notes. However, it does not draw an explicit link between lower price rises and smaller yields.

The North Korean authorities officially aim to import 300,000 tons of grain to make up part of the 507,000 ton shortfall, leaving a potential “food gap” of 207,000 tons. This year, China gave North Korea more than that in aid: 220,000 tons of corn and 33,000 tons of rice.

However, the report warns that there is little room for maneuver despite the slightly improved situation. “The households food security situation has improved compared to last year,” it concedes, “but food rations remain too tight to take away household’s anxiety about whether they will have access to sufficient food. Because of this, the predominant share of the population remains food insecure.”

In conclusion, it notes, “International support (should be) focused on expanding and developing nutrition programs specifically targeted to about 2.8 million vulnerable people (children, pregnant and lactating women, elderly and disabled or chronic ill) in five provinces in the northeast of the country.”