March 26, 2008

South Korean pork traders pay less but charge more than Chinese traders
 

Pork traders in South Korea pay less for their pork than their Chinese counterparts but significant retail margins cause South Korean consumers to pay nearly three times more than Chinese consumers, the South Korean Embassy in Beijing said on Monday (March 24, 2008).

According to an Embassy survey of pork prices in the two countries, pork costs less in South Korea's wholesale market than it does in China, the Chosun news reported.

However, South Korea's complex distribution system meant consumers end up paying nearly three times more than what Chinese consumers pay.

According to the Embassy, as of Feb. 26, pork was traded at W2,666 (US$1=W997) per kg in the South Korean wholesale market, 10 percent cheaper than in the Chinese wholesale market (W3,020).

However, significant wholesale-to-retail marketing margins for pork in South Korea, drove up retail prices to W12,000 per kg, about six times the wholesale price.

In China, at a retail price of W4,420 per kg, it is just a 47 percent margin.

The same situation exists for beef sales in South Korea, where the retail price is about four times that of the wholesale price. (W62,000 compared to W13,588).