According to the Korea Rural Economic Institute (KREI) on Wednesday, average farmgate rice prices during the October-December harvest season are expected to remain at or slightly above last year's level of 57,735 won per 20 kilograms.
The outlook reflects expectations of lower production, declining inventories of older rice and additional demand from distributors seeking supplies to repay previously borrowed rice.
The Ministry of Data and Statistics estimated on October 8 that rice production would fall 0.6 percent from a year earlier to 3.518 million metric tons, the lowest since 2020.
Excluding about 58,000 tons of rice designated for processing under a government supply-management program, production is estimated at 3.46 million tons, down 2.2 percent from last year.
The government had previously projected a rice surplus of about 66,000 tons above domestic demand, but the actual surplus could be smaller as production and milling yields are expected to fall below earlier estimates.
Current rice prices, however, remain below last year's levels.
As of October 26, the average retail price stood at 63,915 won ($48) per 20 kilograms, down 2.2 percent from a year earlier.
Rice prices rose unusually sharply during last year's harvest season as inventories from the 2024 crop declined and frequent rainfall delayed harvesting and shipments of the 2025 crop.
This year, remaining inventories of older rice and declining demand from restaurants, institutional food services and households have kept prices relatively low during the early harvest season.
Yet processing facilities are facing heavy workloads as newly harvested rice arrives.
"We have so much rice coming into the processing center that we cannot allow outside visitors," an official at Icheon Agricultural Cooperative's rice processing center told AJP.
"Forklifts are constantly moving rice around, and even parking has become difficult. With operations running nonstop, safety is a concern," the official added.
Despite the heavy inflow of newly harvested rice, analysts expect the market to tighten as older inventories are depleted.
As of the end of September, rice inventories held by distributors totaled 212,000 tons, up 102,000 tons from a year earlier.
However, KREI expects most remaining stocks of older rice to be exhausted by the end of October, taking into account planned repayments of borrowed rice.
"Rice prices charged by distributors are also expected to be higher than last year," a KREI official said.
"Prices would normally decline in November and December as the harvest gets into full swing, but we do not expect that to happen this year," the official added.
The institute said there were few factors likely to put further downward pressure on harvest-season prices, although the outlook could change depending on final crop yields, compliance with supply-adjustment contracts and government measures to stabilize the market.
The Ministry of Agriculture, Food and Rural Affairs plans to review final production figures and harvest-season purchasing trends before adjusting the amount and timing of rice loan repayments.
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