SMEs warn tofu, soybean paste factories may halt over soybean shortfall

SMEs producing tofu and soybean paste products are calling for an overhaul of the import regime. They warn that some factories could halt operations as early as September because this year's supply of processing-use soybeans falls short of demand. Unlike the soybeans used mainly by large companies for oil extraction, processing-use soybeans used mainly by small and medium-sized enterprises are subject to tariffs and import profit charges. The industry says this must be fixed.

Kim Suk-won, vice chairman of the Korea Federation of SMEs, held a press conference with other industry officials Wednesday morning at the federation. Kim also heads the Gwangju-South Jeolla Fermented Food Cooperative. The event was titled "Calling for the Resolution of Structural Contradictions in the Supply Policy for Edible (Processing-Use) Soybeans and Reform of the Import System." They said they would also submit a related petition to the National Assembly's Agriculture, Food, Rural Affairs, Oceans and Fisheries Committee.

The industry's biggest concern was the volume shortage. According to the cooperative, the domestic processing-use soybean industry needs at least 250,000 tons a year. The government's 2026 supply plan calls for only 223,899 tons — about 26,100 tons short of what the industry says it needs at minimum. An industry official said, "The government cut import volumes to help clear domestic soybean stockpiles, but this creates a price mismatch and technical problems that make it difficult to produce tofu."

The industry expressed concern that once companies exhaust their current raw material stockpiles, production disruptions could begin in earnest at tofu and soybean paste manufacturers nationwide starting in September. Processing-use soybeans are a raw material used directly in food production such as tofu and soybean paste, so prolonged supply disruptions could lead to reduced output or factory shutdowns.

The industry also raised the disparity in import conditions between oil-extraction soybeans, used mainly by large companies, and processing-use soybeans. According to the petition, oil-extraction soybeans are subject to a 0 percent tariff-rate quota and can be imported directly and autonomously through end-user groups.

Processing-use soybeans, by contrast, are supplied through state trading and public auction bidding led by the Korea Agro-Fisheries & Food Trade Corp. (aT). The industry argued that a 5 percent tariff and import profit charges on top of that are adding to the raw material burden for small and medium-sized food companies.

SMEs also argued that the policy of restricting import volumes to preserve domestic soybean stockpiles does not match the actual market structure. In the petition, they said, "The price gap between domestic and imported soybeans is about 3.5 times, and the two also differ in main consumer base and products used, effectively forming separate markets."

The industry called for applying the same 0 percent tariff-rate quota to processing-use soybeans as to oil-extraction soybeans and abolishing the import profit charge. They argued that the current system, centered on state trading and auctions through aT, should be changed. Direct imports should be allowed by end-user groups that actually use the raw material, such as fermented food associations and soybean paste cooperatives.