DEMAND FOR MEAT AND FISH PRODUCTS IN KOREA

DEMAND FOR MEAT AND FISH PRODUCTS IN KOREA

Food consumption in Korea has changed due mainly to increased per capita income over
the last two decades. Consumption patterns are shifting toward eating more meat (beef, pork, and
chicken), vegetables, and fruits rather than cereals. Meat consumption has increased eight fold,
from 165 thousand metric tons to 1,339 thousand metric tons over the 1970-97 period. Pork
consumption increased faster than consumption of beef and chicken during this time period.

Fish products are important sources of protein in the Korean diet, and their consumption
is large compared to meat products. Per capita consumption of fish products was 34.1 kg in
1997, while per capita consumption of beef, pork, and chicken combined was 25.3 kg. However,
consumption of fish products has declined slightly for the 1980-98 period.

The Korean meat industry is currently facing a challenge from trade liberalization under
the World Trade Organization (WTO). Imports of frozen pork and chicken were liberalized on
July 1, 1997, and the Korean beef market was liberalized on January 1, 2001. The Korean fish
industry is also undergoing trade liberalization. From the Asia-Pacific Economic Cooperation
(APEC) agreement in 1997, nine fish commodities were liberalized in 1999, and all tariffs in
fishery sector will be eliminated by 2007.

The objective of this study is to estimate consumers’ behavior in the consumption of meat
and fish products in Korea. Special attention is given to fish product consumption as a meat
substitute because fish products are important sources of protein in Korea.

The study estimated the meat demand system in Korea using the Linear Approximate
Almost Ideal Demand System (LA/AIDS). The F and Likelihood Ratio (LR) tests were used to
test separability between meat and fish products. A model specification test developed by Alston

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