The fixed price of ‘blind’ eggs has been abolished, with the introduction of standard trading contracts.

Ministry of Agriculture, Food and Rural Affairs, transparent price determination structure, abolition of backward payment method, pre-emptive production management
Gradual replacement with survey and announcement of livestock product quality evaluation at production sites,

[Seoul=Newsis] Photo by Choi Dong-jun: Citizens shopping at a large mart in downtown Seoul on the 26th. June 26, 2024. [email protected],
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, “[Sejong=Newsis] Reporter Lim So-hyun: The government is improving the egg pricing survey system and opaque trading practices that have been ongoing for over 60 years. When distributors trade with farmers, they must use a ‘standard trading contract’ and producer associations will no longer set prices.”,
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, ‘The Ministry of Agriculture, Food and Rural Affairs announced on the 31st that it will improve the egg pricing survey system and opaque trading practices.’,
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, ‘According to the Ministry of Agriculture, Food and Rural Affairs, producer associations have been setting egg prices since the 1960s, based on a negotiated reference price rather than the actual traded price between farmers and distributors.’,
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, ‘The producer associations maintained the pricing method under the pretext of protecting farming households with weaker bargaining power compared to distributors.’,
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, ‘On the other hand, egg distributors did not confirm the purchase price with farmers when buying eggs. They continued the practice of delaying payment confirmation to farmers 4-6 weeks after purchase, taking into account factors such as out-of-spec eggs and prices sold to delivery companies, known as the ‘backward payment’ method.’,
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, ‘The pricing set by the producer associations and the backward trading practices of the distributors were claimed to have caused mutual distrust, hindering transparent egg pricing and trading.’,
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, ‘In particular, it was pointed out that price increases occur rapidly due to price setting, but declines are slow. Backward trading also caused operational uncertainties for farmers as they were unable to immediately collect payment after shipping their products.’,
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, ‘Such price setting and trading practices ultimately made it impossible to form representative egg trading prices, hindered the development of various egg distribution channels, and increased trading costs.’,
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, ‘The Ministry of Agriculture, Food and Rural Affairs discussed improvement measures with relevant organizations since 2021 but failed to reach a consensus due to differing opinions.’,
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, ‘However, after launching a research project to establish a representative egg pricing survey system last year (September to December 2023) and continuous consultations with related organizations based on mutual trust (January to July 2024), the improvement measures were formulated.’,
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, “First, when distributors trade with farmers, they will be required to use a ‘standard egg trading contract’ specifying the actual trading price, inspection standards, etc.”,
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, ‘This will be implemented with the agreement between farmers and distributors and will be institutionalized through future legal amendments. To promote the widespread use of the standard trading contract for future transactions, it was created through collaboration between producer associations and distribution organizations, and incentives such as priority listing on online wholesale markets will be provided.’,
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, ‘Furthermore, the Livestock Product Quality Evaluation Institute will survey and announce egg trading prices and abolish producer associations\’ price setting. To increase the representativeness of the survey prices, a certain number of hub farms and distributors will be selected as samples by region, and actual egg trading prices will be surveyed and announced daily excluding backward trades.’,
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, ‘There are plans to verify, improve, and advance through a consultation body composed of egg-related organizations and experts.’,
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, ‘Additionally, observations will be strengthened to enable rational farming and business decision-making based on future supply predictions by producers and distributors.’,
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, ‘The observation period for providing egg supply and price forecasts utilizing egg production information and history will be extended from the current within 3 months to within 6 months.’,
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, ‘With these improvements in trading practices, it is expected that a representative egg trading price will be formed and presented transparently, enabling direct, online, and auction-based transactions between producers and distributors, leading to a reduction in negotiation costs and trade expenses.’,
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, ‘Consumers are expected to be able to purchase eggs at more reasonable prices. Furthermore, it is anticipated that by enhancing observations using various information collected during the survey process, stable egg supply and price management will be promoted.’,
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, ‘Kim Jung-wook, Deputy Director of Livestock Policy at the Ministry of Agriculture, Food and Rural Affairs, stated, “We have improved the objectivity and transparency of egg price information that the public consumes on a daily basis, and will actively make efforts in collaboration with producer associations for stable egg supply management.”.’,
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