The Ministry of Agriculture, Food and Rural Affairs announced that processed rice is now available for wholesale on the online agricultural product wholesale market. The processed rice being traded is high-quality rice produced by Rice Processing Centers (RPCs) affiliated with agricultural cooperatives. It is estimated that rice processors and RPCs will trade approximately 4,492 tons (worth about 4.3 billion won) of processed rice by the end of the year.
This trade is conducted through a group purchasing system, where the Korea Rice Processing Food Association purchases the desired quantities of 1,744 member companies and allocates them. Previously, individual companies had to visit RPCs directly to purchase processed rice, which required a significant amount of time and cost for negotiating prices and verifying quality.
The online wholesale market has streamlined the trading process by allowing the Rice Processing Food Association, acting as a professional purchasing agency, to handle price negotiations, quality verification, and delivery, consolidating previously fragmented transactions.
The Rice Processing Food Association stated, "Previously, it was difficult to obtain raw materials of the desired quality due to a lack of information about sellers. However, the online wholesale market makes it easy for companies to find the sellers they want, increasing industry satisfaction."
This is the first case of group purchasing through the online wholesale market. The Ministry of Agriculture plans to establish a joint logistics support system, such as supporting small-quantity, multi-item combined delivery, to promote future group purchasing.
The ministry expects that the purchase of RPC rice by rice processors will lead to increased rice consumption. The rice processing industry has been growing rapidly, with domestic sales exceeding 8 trillion won in 2022 and an average annual growth rate of 7% for the domestic market and 19% for exports over the past five years.
The Ministry stated, "By utilizing rice from RPCs with strict quality management systems, the rice processing industry can enhance product differentiation through the upgrading of raw materials, leading to increased added value. As the rice processing industry grows and the trading volume of processed rice increases, it is expected to contribute significantly to supply stabilization by increasing both the use of government-stored rice and domestic rice consumption."
The RPC industry also welcomes the online wholesale market. They believe that group purchasing will help increase rice sales by allowing them to sell large quantities of rice at once. The immediate settlement of payments after transactions is also an advantage, eliminating the risk of receivables. The Agricultural Economics Federation plans to actively utilize the online wholesale market as a new sales channel, considering the trend of the rice market shifting from offline to online.
Park Su-jin, Director-General of the Food Policy Bureau at the Ministry of Agriculture, said, "The rice processing industry is driving the growth of the K-food industry, while the online wholesale market is revolutionizing the agricultural product distribution structure. Through the online wholesale market, the rice processing industry can conveniently procure high-quality processed rice, expanding the growth of the industry, and RPCs can create new sales channels, promoting rice consumption. This is expected to create a virtuous cycle."
[Copyright (c) Global Economic Times. All Rights Reserved.]
