Today's Date:  Monday, August 27, 2012

1. BILATERAL/MULTILATERAL ISSUES

<8/10/2012> Free trade deals changing snack and fruit menus in Korea [English, CSY]

http://english.donga.com/srv/service.php3?bicode=020000&biid=2012081189548

Summary: “Cherries or oranges from the U.S. for dessert after dinner, beer from Belgium for drinks late at night when watching the Olympics, and almonds and raisins from the U.S. as snacks while drinking beer...” This is a simple menu for the family of homemaker Gang Hye-jin, 32, in Seoul`s Dunchon-dong neighborhood. Until two to three years ago, her family’s household ledger displayed mostly Korean-made beers and juices as well as a list of domestic fruits such as watermelons and melons. Back then, she would have been reluctant to buy imported good because they were relatively more expensive.   But since Korea`s effectuation of free trade agreements with the European Union and the U.S., Gang and many other Koreans have had a change in dietary habits in recent months, as the prices of imported foods have declined sharply.

-Foreign agro-products changing Korean dessert market

American fruits have benefited significantly from the lifting of tariffs since the Korea-U.S. trade accord took effect in March. According to a tally by the Seoul Agricultural and Marine Trade Corp. released Thursday, the average auctioned price of cherries was 39,500 won (35 U.S. dollars) per 5-kilogram box, down 38 percent from the same month last year.

-Consumer benefits rise, but higher competitiveness of domestic produces needed

Demand for American nuts and almonds increased so much that their imports jumped 30 to 50 percent in the first half year-on-year. Notably, imports of leaf tobacco from the U.S. doubled, while the portion of foreign-processed coffee and cocoa products in the Korean market also rose.

2. ECONOMIC ISSUES

S. Korean consumer sentiment hits 7-month low in Aug. [English, CSY]

http://english.yonhapnews.co.kr/business/2012/08/24/53/0503000000AEN20120824008100320F.HTML

Summary: South Korean consumers' confidence dipped to a seven-month low in August as the protracted eurozone debt crisis and China's slowing economy heightened economic uncertainties, the central bank said Monday.  The consumer sentiment index (CSI) -- a gauge of consumers' overall economic outlook, living conditions and future spending -- came in at 99 for August, down from 100 tallied in the previous month, according to a survey by the Bank of Korea (BOK).   The August figure marked the lowest level since the index hit 98 in January, the bank said.

Top 10 Conglomerate Business Groups Account for 77 Percent of Total Korean GDP [Korean, OSY]

http://www.yonhapnews.co.kr/economy/2012/08/25/0325000000AKR20120825054700008.HTML?template=2087

Summary: Chaebol.com, a NGO economic institute reported on August 27 that cash-register sales (inclusive of sales in overseas) of top 10 conglomerate business groups totaled 946 trillion won in 2011, which was 77 percent of total Korean GDP.  If excluding the sales in overseas, cash-register sales of top 10 business groups accounted for a 39 percent of Korean GDP.  Samsung Group was the top conglomerate business group at 118 trillion won, followed by SK Group (90 trillion won) and Hyundai Car Group (84 trillion won).

3. GRAIN & OILSEED ISSUES

International Grain Price Likely to Remain High, aT [Korean, OSY]

http://www.yonhapnews.co.kr/economy/2012/08/24/0318000000AKR20120824141200002.HTML

Summary: Korea Agro-Fishery Marketing Corporation (aT) reported on August 24 that its special committee on international grain trade had concluded that international price of grain would remain high.  According to aT’s analysis, international grain production in 2012/2013 marketing year would total 2.25 billion tons, down 2.7 percent from the previous year, while consumption would exceed the production by 40 million tons.

4. MARKETING ISSUES

Tagatos, Low Calorie Natural Sweetener, Reports a Good Sales, CJ [Korean, OSY]

http://www.yonhapnews.co.kr/economy/2012/08/27/0318000000AKR20120827045900003.HTML

Summary: CJ Cheiljedang reported on August 27 that sales volume of Tagatos, a low calorie natural sweetner that CJ launched last year, in the industrial segment has increased to nine tons a month.  CJ added that main customers of the sweetener are local food processors.