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Photo courtesy of Yonhap News |
[Alpha Biz= Paul Lee] SEOUL, South Korea — The Korea Fair Trade Commission (KFTC) announced on the 12th that it has imposed a total of 3.165 billion KRW (approx. $2.3 million) in fines and corrective orders on nine pork processing and sales companies. The entities are accused of colluding on bid prices and quotes for pork supplied to E-mart, South Korea’s leading retail chain.
The "Price Fixers"
The nine sanctioned companies include:
Daeseong Silup, Daejeon Chungnam Pig Farmers Cooperative, Bukyeong Pig Farmers Cooperative, CJ Feed & Care, Dodram Food, Bodam, Sunjin, Farmstory, and Haedrim LPC.
The KFTC has decided to refer six of these firms—Daeseong Silup, Daejeon Chungnam Pig Farmers Cooperative, Bukyeong Pig Farmers Cooperative, CJ Feed & Care, Dodram Food, and Bodam—to the prosecution for criminal charges.
Collusion Tactics: Telegram and Price Guidelines
The investigation revealed a systematic effort to manipulate prices across two categories of pork:
General Pork (Non-branded): Between November 2021 and February 2022, eight companies colluded on 8 out of 14 bids, setting minimum price floors for cuts like pork belly and shoulder. The total contract value involved was 10.3 billion KRW.
Brand Pork: From July 2021 to October 2023, five companies coordinated their quotes on 10 separate occasions, involving contracts worth 8.7 billion KRW.
Evidence from a private Telegram group chat showed representatives discussing "setting an appropriate minimum price" and "establishing price guidelines" to "minimize losses for each company." Four companies—Dodram Food, Sunjin, Farmstory, and Haedrim LPC—were found to have participated in collusion for both categories.
Impact on Consumers
The KFTC concluded that this cartel directly led to inflated retail prices at E-mart, forcing consumers to shoulder higher costs for essential food items.
"We will take stern measures against any collusion in the food sector that triggers inflation and hurts the livelihoods of citizens," said Moon Jae-ho, Director General of the KFTC’s Cartel Investigation Bureau.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
