NORTH BATTLEFORD, Sask. – South Korea is still stunned from the roundhouse it received from the Asian financial crisis two and a half years ago, but the country will soon be back in world markets, a federal analyst says.
That’s good news for Canadian velvet producers, who have seen their biggest and most lucrative buyers almost disappear, said Jim Hannah of Agriculture Canada.
“It’s going to get better,” said Hannah at the Discovery 99 specialty livestock conference. “We know that.”
Hannah said most analysts predict the Korean economy will grow again in the second half of 1999. Although it will be only one or two percent growth, it may offer enough to allow Koreans to buy imported velvet again.
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Hannah said Koreans have started to travel abroad again. That is a sign of increased consumer spending.
Elk velvet exports to South Korea collapsed in 1998. Canadian agri-food exports to the country dropped from $411 million in 1997 to $150 million in 1998. In 1997 South Korea imported more than 100,000 kilograms of elk velvet from Canada, the United States, Australia and New Zealand. In 1998 that dropped to 30,000 kg.
“That’s why you people haven’t sold anything – because they aren’t buying anything,” said Hannah.
Korea has a long way to come back to regain its pre-crisis economic wealth. The peoples’ per capita income in 1997 was $9,400. In 1998 it was $6,500.
The country dominates world elk velvet trade, taking 80 to 90 percent of exports.
Domestic elk production in South Korea has increased. In 1975 there were only 207 animals producing 582 kg of velvet. In 1997 the country had 28,000 elk producing about 45,000 kg of velvet.
But Hannah said that is still far below the amount Koreans want to consume. If their economy recovers, they’ll be back in the velvet market.
