Food has never been more abundant in South Korea. Annual agricultural output exceeds 60 trillion won, and markets and supermarkets are stocked with farm, fishery and processed food products. Yet Moon Jeong-hoon, a professor of agricultural economics and rural development at Seoul National University who heads the university's Food Business Lab, said in an interview with The Seoul Economic Daily on the 19th that "raising the quality of the consumption market matters as much as expanding its size." Neither the reality of farms locked in price competition nor the government's paternalistic support measures can cope with market opening and climate change, the professor argued. Moon is a food business specialist who bridges agriculture and management studies, traveling to farming regions and the front lines of the food and distribution industries across Korea and around the world, conducting research on "eating well and drinking well" and engaging actively with the public on behalf of more diverse food consumption. "The most important thing is to make consumer demand more sophisticated," Moon said. "Consumers should not simply eat whatever they are given, and the government should design policy more precisely in the direction of raising the quality of the consumption market. Increasing the diversity of what we eat is the real way to prepare."
— What does the Food Business Lab research?
Our vision is "a world where we eat better, drink better and play better." We wanted to share with everyone the happiness that comes from food. Conventional food research concentrates on how to get people to eat less bad food and drink less alcohol. That matters too, but our task is to study, without prejudice, how eating can make us happier and more joyful. As a result, we have plenty of opportunities to work with local farms, livestock and agricultural businesses, and food and distribution companies.
— Having visited farming regions around the world, what problems do you see in Korean farms?
They are industrially fragmented. To build competitiveness against substitutes or imported produce, you need a certain scale, but farms here are so small that instead of setting and carrying out an industrial strategy at the national level, the government only rolls out paternalistic support measures. Of course, the political reasons behind that are probably bigger. It is the same reason raising rice prices has become the core of farm policy.
— Realistically, Korea cannot scale up farms the way the U.S. has, can it?
France, Spain and Italy are worth benchmarking. There, agribusinesses and large farms realize economies of scale while small individual farms fill segmented consumer needs, creating an ecosystem. Compared with those countries, our particular weakness is the absence of consumer policy. We have policies to support producers and prop up farm prices, but no attention is paid to the consumption of farm products. This is not limited to food. For a regional industry to grow, raising the quality of the market matters as much as expanding its size, and it is unfortunate that we have no policy for that.
— Do you mean the level of farm-product consumption has to rise?
The Galaxy phone emerged in Korea because there are consumers sensitive to handset features who replace their phones quickly. In the same way, French agriculture is strong and its gastronomy developed because consumer demand there is sophisticated. Economies of scale alone cannot satisfy consumer palates and preferences, which is why small farms producing diverse, specialized products can grow. An ecosystem has been built where quantity and quality, low-priced and high-priced produce coexist. The Korean market, by contrast, emphasizes efficiency alone and is structurally skewed in its demand. Everyone grows similar crops, so only price competition intensifies. No matter how hard I try to persuade producers to try growing diverse varieties, they do not take it up.
— So securing buyers is what matters.
That is why I changed strategy. I communicated with restaurant chefs and ordinary consumers, constantly telling and persuading them that there are strawberries with this flavor and pork with that particular character. The results included some remarkable successes. A leading example is Golden Queen No. 3 rice, the starting point for domestically grown aromatic rice. I was told that a new rice variety, the first bred by the private sector, simply would not sell, so I posted about it on social media and told chefs about it. Once it was supplied to well-known restaurants, demand gradually began to grow, and within about a decade it became one of the top 10 varieties by cultivation area. Nanchukmatdon, a specialty pork brand developed through regional breeding programs, made its way into the consumption market after I persuaded a Michelin-starred chef, and it is now established as a premium pork that is in short supply even when buyers want it.
— What role should the government play?
The Rural Development Administration, which has the largest staff of any research institution in Korea, develops and improves a great many varieties. The problem is that the varieties it develops are not actually grown and do not succeed in the market. That is because varieties are developed from the supplier's perspective, unrelated to demand from consumers and foodservice businesses. The era of the Saemaul Movement ended long ago. A "taste market" is now opening. We need to analyze the market precisely, build scale and raise quality so we have the strength to compete against low-grade produce and win.
— There is considerable concern about cheap produce flooding in as markets open.
If quality is the same, consumers choose the cheaper product. If cheap rice produced at large scale abroad is imported, we are bound to lose on price. What we have to prepare is to give consumers preferences and to produce rice that meets segmented demand. Consumers benefit from more choices, and producers secure a high-value-added market. There is no need for price competition that eats into your own flesh. In that respect, the area with the most sophisticated consumption among our farm and livestock products is probably hanwoo, Korean beef. Even after American beef came in, hanwoo did not collapse. We can afford to have more confidence in hanwoo.
— Climate change also has a major impact on food. How will our tables look in 10 or 20 years?
Olives, which could not be seen in Korea before, are already being grown on Jeju Special Self-Governing Province. Apples, on the other hand, will all but disappear. After 2050, the main apple-growing regions are projected to shift to North Korea, with cultivation in South Korea possible only in the northern part of Gangwon State. The Hongro and Fuji varieties, which account for 70% of the domestic apple market, have thick skins and firm flesh, which is advantageous for distribution but disadvantageous under climate change.
— How can Korean produce be protected in an increasingly harsh climate?
There is no answer other than growing varieties suited to the climate. An apple orchard I visited in Brittany, France, several years ago was growing more than 30 varieties. They said that because they do not know which varieties will survive a decade from now in a rapidly changing climate, they track how a wide range of varieties perform. It is hard for our farms to do that. So the state has to step in. We need to develop varieties that account for breeding suited to climate change and suitability for cultivation, along with consumer preferences and suitability for processing, and then connect that to market formation.
— On that note, what do you find lacking in farm policy?
Under the Moon Jae-in administration, smart farms were built and sold off in the name of "agricultural advancement," and they mainly grew tomatoes. That much was fine. But as tomato shipments surged, tomato prices collapsed this summer. In response to climate change, the government also encouraged production of long-grain rice, known as "annammi," in Haenam. But once the rice was harvested, there were neither milling facilities nor buyers for long-grain rice, and the farms that grew it had a very hard time. Fortunately, a large U.S. Mexican food chain recently opened a store in Seoul, and a purchase contract was finally signed, so the cultivation area has now increased. Farm policy has to shift from a producer- and supply-centered approach to a consumer-centered one, toward changing the quality of demand. Policy has to be designed with a far more precise view of the consumption market. That is the way to prepare for market opening and climate change. At the very least, producers who follow national policy should not end up losing money, should they?
— How do you assess where K-food stands, given the global attention it has drawn?
The truth is that much of the interest in K-food has ridden on the popularity of Korean content. The reality is that no matter how much you walk around Manhattan in New York, Korean food is hard to find outside of Koreatown and a few special fine-dining establishments. I see K-food as standing at its real starting point now. For K-food to become everyday food abroad, it has to break into the territory of easy meals and staples. That is also why localization matters when entering a market.
— What stands in the way of localizing K-food?
First, there are no meat-processing methods abroad suited to Korean food. It is also a problem that Korean sauces matched to local palates have not been commercialized. Unless the issue of pre-processing ingredients is resolved, there are bound to be limits to spreading Korean food to the mass market. That said, when we talk about K-food we think only of the U.S. and Europe, but in Southeast Asia Korean food has moved well past the early stage and penetrated quite deeply. We have now reached a point where the ramen, kimchi and fried rice we export have to compete with Korean food produced locally.
— What needs to be done to increase K-food exports and globalize it?
We have to open export channels for ready meals containing meat and for fresh meat. That is how K-food export value will grow substantially. Selling one head of cattle is worth more than selling hundreds of thousands of perilla leaves, isn't it? On top of that, the main event in dining out is meat. A pork-and-rice-soup specialty restaurant may have opened in New York, but so far it is practically the case that we have never properly sold K-food. Of course, diplomatic issues are tangled up in this and there will be resistance from livestock farms, but now there is a need to pursue it with confidence. Having hanwoo expand overseas could be far more advantageous than defending against imported meat. Japan's wagyu exports are enormous. Exports gain momentum only when you sell high-value products.
— What are the tasks for developing Korea's agrifood sector?
The expansion of processed food exports on the back of K-food's popularity is clearly an important achievement. But if that achievement does not translate into growth momentum for agriculture, it can only amount to half a success. It is now time to ask not "how much did we export" but "what did exports leave behind for our agriculture." Above all, it is important to build a premium consumption base in the domestic market so that agriculture does not come down to price competition. For that, consumers must not simply eat whatever they are given. Seeking out ingredients that suit one's own palate and purpose — that will be the beginning.
◇He is…
Born in Busan in 1973, Moon completed his bachelor's and master's degrees at Seoul National University's College of Agriculture and Life Sciences and earned a doctorate in business administration from the State University of New York. After serving as a professor in the Department of Management Science at KAIST, he has been a professor in the regional information program of Seoul National University's Department of Agricultural Economics and Rural Development since 2010, and has headed the university's Food Business Lab, founded in 2014, since its establishment.