Urgent Actions Needed for South Korea's Inorganic Fertilizer Sector
Seoul, Sunday, 29 June 2025.
South Korea’s inorganic fertilizer industry faces severe challenges due to high raw material costs and exchange rate fluctuations. Immediate government intervention is critical to stabilize the market.
Challenges Facing the South Korean Fertilizer Industry
South Korea’s fertilizer sector is grappling with significant challenges, including surging raw material costs exacerbated by trade protectionism and volatile exchange rates [1]. The industry has seen only one company report profitability in the previous financial year, with others suffering deficits due to these financial strains [1]. Rising production costs, especially a dramatic 65% increase in electricity prices over the past three years, are further squeezing profit margins for manufacturers [1].
Shifts in Market Dynamics
The fertilizer market in South Korea is experiencing a shift from fast-acting to slow-release fertilizers, alongside growth in liquid and water-soluble fertilizer segments [1]. These changes reflect a broader trend towards more efficient and sustainable agricultural inputs [1]. However, the pressure to innovate and adapt to these market shifts is intense, requiring substantial investment amidst already high operational costs [1].
Government Intervention Necessities
Industry leaders have stressed the urgent need for government intervention to stabilize the market. Recommendations include lowering interest rates on raw material purchase loans, currently higher than general agricultural policy loans, and providing support for maritime freight costs, which are critical in maintaining competitive pricing for exports [1]. These measures are deemed essential to uphold the sector’s viability and prevent further economic losses [1].
The Role of Innovation in Food Production
Despite these challenges, innovation in food production offers potential mitigation paths. Advances in agricultural technologies and lab-grown food are seen as strategic avenues to improve food production efficiency and reduce environmental impact [GPT]. Korean companies, such as Epikurean Biotech, are pioneering lab-grown meat technologies, which they claim can significantly reduce greenhouse gas emissions compared to conventional livestock farming [GPT]. This innovation not only addresses sustainability challenges but also opens new economic opportunities within the agricultural sector [GPT].