| A Study on the Farm Management Stabilization Support System: Current Situation and Policy Implications (Year 2 of 2) | |||
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| Author | Park, Joonki | ||
| Views | 41814 | Publication Date | 2016.01.26 |
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Farm Management Risk and the Need for Policy This study aims to analyze the actual condition of farm management risks for specialized farmers who have a high dependence on agriculture income in the industrial aspect. Moreover, this study analyzes major issues of a current Farm Management Stabilization Support System (FMSSS) and presents reform and expansion plans of this support system. The farm management risk is increased by high supply volatility caused by natural disasters and animal diseases, low rates of turnover in accordance with the long growing season, rising input prices, and increasing supply of imported agricultural products in accordance with market openness. A result of farm household economy analysis shows that specialized farmers who have a high dependence on agriculture income are exposed to greater risk than the general farmers since the specialized farms’ agriculture income decrease more and they have a higher debt compared to the general farmers. It is necessary to have a systematic farm management support system in order to stabilize the management risk by reducing the price and supply volatility. Meanwhile, as a result of FTA implementation with 11 countries the tariff of imported agricultural products will be gradually eliminated. Increasing agricultural imports will raise farm management risk such as a decline in production and investment of farmers and rapid declines in prices of agricultural products. Therefore, the government should support farmers with the FMSSS that is different from what the USA or EU, a huge exporter of agricultural products, does to reduce the impact of market risk. Current Issues and Reform Direction FMSSS consists of various programs to manage farm risks. But it should be developed in some parts. 1) The goals of FMSSS should be more clear. 2) Different approaches to management programs should be applied according to the types of crop and risk. 3) The budget of FMSSS is too concentrated on the rice industry. So, it should be allocated to other crops. 4) The purpose of most FMSS programs is stabilization of price and balance of supply-demand in the short term, and they are post measures. So, we need to design long-term and pre-measure programs. 5) The policy target and purpose of FMSSS should be clarified. And the organic linkage between programs is also important. Reform Concept This study suggests that the vision of agricultural policy should be “to realize the harmony between agriculture, humans and the environment through agriculture as a sustainable industry.” And it also suggests that the goal of FMSSS should be “to stabilize farm management, to guarantee a reasonable standard of living, and to realize sustainable agriculture.” The following are ways to achieve the objective. 1) We need a social consensus about the multi-functionality of agriculture and rural society. 2) We need to cope with the risk of declining profit due to a rapid decline of price, increasing operating costs, direct impact of market openness. 3) We need to support the reasonable standard of living through the stabilized farm management conditions. Researchers: Park Joonkee, Oh Naewon, Ji Sungtae, Lee Hyunkeun, Jeong Hoyeon Research Period: 2015. 1. ~ 2015. 12. E-mail address: jkpark@krei.re.kr |
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