Shenyang, China — The North Korean authorities have started applying follow-up measures to cope with food supply difficulties which the majority of the North Korean poor classes are facing due to the suspension of jangmadang operations since the currency redenomination.
The authorities have decreed that rice and corn should be sold in so-called procurement stores at roughly half the prices which were designated after the July 1st Economic Management Reform Measure in 2002. However, this is unlikely to be enough because stocks are low.
The prices designated by the state in 2002 put rice at 45 won and corn at 24 won.
A source from North Hamkyung Province said on the 13th, “Since the 11th, food reserves in procurement stores have been sold according to the rules applied by the state. They didn’t allow traders to sell food in the jangmadang at all; they only opened the procurement stores.”
This is because the jangmadang or associated alley markets are not readily controllable, but the government can control directly the food prices in procurement stores. The traders operating these stores usually pay around 40,000 won per month in rent to the state and generally sell products at similar prices to those in the jangmadang. These stores had also closed their doors since the redenomination.
“Since rice was permitted to be sold at half the state-designated price, rice prices dropped temporarily,” a source from Yangkang Province admitted, “However, a few days later rice prices will go up because their rice and other food stockpiles are generally small.”
Additionally, a second decree was handed down whereby traders may not sell more than a sack of rice (25 kg) to any single individual, and if a trader buys a large amount from a wholesaler the authorities will confiscate all his/her stocks and deprive the trader of the right to operate the store.
The authorities advised traders that if they follow the principles the state has laid down, they will be allowed to do business continuously in the future, according to the source.
The Daily NK’s North Hamkyung Province source explained how sales went, “When the stores started selling rice, they quickly got all messed up. In half a day the rice in the stores was all sold out.”
The Yangkang Province source explained more about the rules governing the sales, “People have to bring their I.D. card, because residents of other provinces are not allowed to buy rice. No household can buy more than one sack of rice.”
He added, “Most stores started selling rice around 2 P.M. on the 11th and were sold out by around 5 P.M. But, people who wanted to buy rice waited there until around 8 P.M. just in case.”
In addition, according to diverse sources, although the authorities have officially fixed food prices, there are big gaps between provinces.
At the time of writing, a kilogram of rice in a procurement store in Pyongyang is between 21 and 23 won, while in Chongjin in North Hamkyung Province and Hyesan, Yangkang Province it is as high as 28 won.
On the other hand, the price of rice being sold through individual houses, in secret, has apparently risen to more than 50 won. Therefore, this can be considered the market price.
The Yangkang Province source also reported, “The authorities suspended all trade with China in advance of the redenomination on November 30th, and reported to China that all work in customs houses would stop until late January next year.”
In addition, the exchange rate between the North Korean won and the Chinese Yuan has yet to be set.
The source is growing worried about the food situation, “Since trade in the jangmadang was suspended, the number of starving households has increased.”
