This is “NK Market Trends,” bringing you weekly updates on the North Korean economy. This week we sat down with reporter Kang Mi Jin to discuss the latest trends; but first, let’s take a look at how the jangmadang [market] has been doing.
We’ll begin by providing a rundown on the price of rice, the currency conversion rates, and the cost of other goods in North Korean markets. The price of 1 kg of rice was 5,150 KPW in Pyongyang, 5,200 KPW in Sinuiju and 5,500 KPW in Hyesan. The USD was trading at 8,200 KPW in Pyongyang and Sinuiju, and 8,155 KPW in Hyesan.
Moving along, the cost of 1 kg of corn rice mixture was 2,000 KPW in Pyongyang and Sinuiju and 2,300 KPW in Hyesan. One kg of pork was selling at 14,000 KPW in Pyongyang and Sinuiju and 15,000 KPW in Hyesan. Gasoline was trading at 9,300 KPW per kg in Pyongyang and Sinuiju and at 8,500 KPW per kg in Hyesan. Finally, 1 kg of diesel fuel was selling at 5,100 KPW in Pyongyang and 5,300 KPW in Sinuiju, and 5,500 KPW in Hyesan. This has been a rundown on North Korea’s latest market prices.
1. We’ve caught word that residents are purchasing lots of watermelon as a way to combat the summer heat. Can you explain the situation to us in a bit more detail?
Yes, the average temperature in North Korea these days is hovering around 30 degrees Celsius. Ice cream and watermelon is the best for cooling off, isn’t it? In South Korea, preserving cool fruits and refreshing drinks is easy because refrigerators are widely owned items, but that’s not the case in North Korea. This means access to frosty treats is that much harder. These days, the temperature swings from about 22 degrees to 35 degrees. It’s unfortunate that residents have such a tough time getting a hold of a cool beverage or fruit on such scorching days. According to an inside source at the market, one watermelon is going for about 13,000 KPW right now.
2. My word. That seems like an awfully high price when you consider the low income of most residents….
That’s absolutely correct. The price of one kg of rice in the Yanggang Province Market is 5,500 KPW, which means you could buy two kgs of rice for the cost of a single watermelon. This puts it out of the reach of normal folks. Watermelons are grown in greenhouses and are available all year round in South Korea, but North Koreans have to buy imported watermelons from China that are preserved by being inserted into holes in the ground. The price gets pushed up so high because importers take their cut and there’s also an import duty. There is a limit to the fruit that is stored in this manner, so this lack up supply also increases the price.
3. Outside of watermelons, what is the situation like for other fruits?
The price of one pineapple at the Hyesan Agricultural market is 10,000 KPW. Of course, this is a pricey purchase, at roughly the cost of two kg of rice. Pears go for about 10,000 KPW for one kg, or approximately four pears. Even though it’s brutally hot and the residents are working extremely hard, most fruit is simply outside the price range of most residents. Heat is bearable, but hunger is harder to tolerate. So the residents invest in grains and other more economical foods.
Bananas go for about 2,500 KPW a piece. An informant told us that because of their prohibitive cost, bananas are usually reserved for special occasions only. We also hear that bananas are occasionally present at meetings, or bought from vendors deep in the mountains for the Chuseok holiday or a wedding. I once visited my father’s tomb to perform ancestral rites and happened to see one resident offer up a banana to his ancestor, only to eat it whole (peel and all) moments later. A source has informed us that most residents are familiar with the word banana, but most have not had the chance to actually try one.
Ever since trade with China was invigorated in the early 2000s, bananas and other exotic fruits began to turn up in the market. Before that, people did not really encounter them. Hence, the story about the gentleman who ate the peel. Since they are so expensive, most people can’t afford them and vendors tend to stick with offering regional fruits such as apples, pears, and churi. I guess you wouldn’t know what churis are, right? They call them jadu (plums) here in South Korea.
4. Refrigeration facilities are old news in South Korea, and most people here are now totally accustomed to reaching into the fridge at their convenience. Given that refrigerators are out of the price range of most residents, I’m interested to learn about what kinds of methods are used to preserve foods.
Because of this insufficiency, North Koreans have become expert in the art of using nature to do the job of modern technology. There are cold springs that flow in mountainous regions. Digging a hole and putting watermelon or other foods in the ground there is an excellent way to preserve them. Oriental melons grew particularly well in Yanggang Province, where I come from.
I would get some of these melons from a local farm, put them in a plastic bag, and even sprinkle a little spring water in there. That’s another way to preserve fruit. But you have to be careful. Our house’s yard had a fence. Inside this fence was a spring well with fresh water so occasionally people would stop by to get some water. One day, when I was out to work I noticed all my oriental melons had disappeared. I assume that a passerby went for water, saw the juicy melons, and couldn’t resist.
5. We’ve talked about how pineapples and watermelons are too expensive for most residents to buy. But I wonder if there are any cheap fruits that are top sellers in the market.
Good point. I’ve also considered that. I agree that it would maximize profits to focus on the fruits that fly off the shelves. I imagine such a sight brings a smile to the vendors’ eyes.
6. As you well know, South Korea’s goods distribution networks are highly developed, so it is easy for people to buy what they want when they want. We’ve received reports that it would be no exaggeration to say that North Korea’s distribution networks are in a state of paralysis. Given the sorry state of North Korea’s infrastructure, how are goods move about?
Yeah, that’s definitely the case. North Korea’s energy shortages and blackouts are chronic. And we have an abundance of testimonies that indicate the transportation system is truly paralyzed. For those that want to take the train, it is necessary to pack a few day’s worth of food and stick it out for a multiday ride, even though the distances are not so great. A lot of vendors have reported that their foodstuffs went rotten before they even got to market because of the train delays.
In 2005, I tried to buy fish at Kim Chaek and ride a train to Hyesan in order to sell them at market. Even though my bags were about 50 kgs, it’s sometimes preferable to walk because the trains were so unreliable. I was forced to stay in one place for three days to wait for the electricity to resume. I had about 180kg worth of fish at that time, so even if I wanted to walk, it wouldn’t have been practical. Once the luggage is over 50 kg it’s best to either stick it out or try to walk to a nearby city with more reliable electricity. These days, ‘servi-cha’ are all the rage. Inside reports suggest more residents use ‘servi-cha’ than trains. It’s a bit more expensive than a train ticket, but it’s faster, more reliable, and there’s less chance of foodstuffs spoiling in transit.
7. Which fruits are doing really well at the market these days?
These days a special North Korean fruit called “baeksalgu” is in season and selling really well. This “more sweet than sour fruit” is produced in North Hamgyeong Province’s Hwei-ryang area. It is a type of apricot. Because of its popularity, the fruit has been designated natural monument number 439. Baeksalgu is soft, so it easily rots, but overripe fruits can either be canned or used to make alcohol. Normally one kg of baeksalgu goes for about 12,000 or 13,000 KPW. Because it is in season these days, baeksalgu is selling even better than apples.
8. So from what you’ve told us so far, it seems that residents hoping to buy one kg fruit will need to spend the equivalent of two kg of rice. That means that fruit must be considered a wallet breaking purchase for most residents, no?
That’s absolutely the case, but residents readily pay the steep price because they’re quite fond of fruit. Sometimes residents opt to go and pick wild berries and fruits from mountainous regions. In Yanggang Province, there is a berry called “Mae-jeot.” It’s a sweet and sour berry. There are also wild strawberries and raspberries. In this way, they compensate for the expensive price of fruits in the market. When I lived in North Korea, I used to take daily trips to the mountain to pick wild berries. In those kind of mountainous areas, it’s hard to grow fruit, so we mostly ate wild berries. Autumn blueberries will also soon be available. Wild berries tend to grow from June to October, so this is a huge help for residents who love fruits but don’t have the cash to spare.
9. The baeksalgu fruit that you mentioned earlier: is that only produced in Hwei-ryeong?
Yes, from what we understand baeksalgu is produced in Hwei-ryeong in Hamgyeong Province. That area produced about 70% of the total baeksalgu yield. A special variety called the Changhyori is much cherished by the people and had been designated at natural monument number 439.
10. It seems apparent to me that transporting native fruits from their place of production to other regions for sale would increase their price. Have we seen that effect in the market?
That’s absolutely true. So we do in fact get a lot of regional variation on the cost of these goods. The vendors use their skills at reading market conditions to make subjective judgments about what an appropriate sales price is. After all, transport costs need to be reflected in the final price in order for the traders to make a profit. Before setting their prices, vendors sometimes take a look at the price of similar products in the market. More often than not, there are runners and wholesalers in the market. Wholesalers sell in bulk to the runners, who sell direct to the customer. So, really it is the wholesalers who incorporate transportation costs into the price. Of course, they are looking to optimize their profits all the time. This is true for all products, not just fruit.