The net profit earned from rice farming last year decreased by over 24% compared to the previous year. This is attributed to increased production costs coupled with a decline in harvest yields due to abnormal weather conditions.

According to the '2024 Rice Production Cost Survey Results' released by Statistics Korea on the 28th, the net profit per 10a (1000㎡) last year was 271,000 won, a decrease of 87,000 won (24.3%) from the previous year. This marks the largest drop in two years since the 185,000 won (36.8%) decrease in 2022.

The net profit margin was 23.5%, a 5.5 percentage point decrease year-over-year. This is the lowest figure since 2016 (21.2%).

The sharp decline in profitability is due to falling farmgate rice prices and rising production costs. Farmgate rice prices fell by 8.9%, from 51,000 won per 20kg in 2023 to 46,000 won last year.

During the same period, the production cost of paddy rice per 10a increased by 7,000 won (0.8%) to 882,000 won. Direct production costs, which are expenses directly incurred in rice production, rose by 2.0% due to increases in contracted farming expenses and seedling costs (seed and seedling purchase costs). Indirect production costs decreased by 1.7% due to a fall in land service costs.

The production cost per 20kg of rice was 33,000 won, an increase of 845 won (2.6%). This is a result of the 1.7% decrease in rice production due to increased damage from pests and diseases caused by concentrated heavy rain and high temperatures during the grain-filling period, despite the rise in paddy rice production costs.

Imputed costs (self-labor costs, self-owned land service costs, and capital service costs) increased by 1.5% to 301,000 won per 10a. This increase is influenced by the rise in capital service costs due to higher interest rates.