Farming cooperatives hit with cancellation fees after aT slashes overseas training support

Some agricultural production cooperatives and farming associations that had booked flights and accommodation in anticipation of support from the Korea Agro-Fisheries & Food Trade Corporation's overseas benchmarking training program have been left paying cancellation fees or covering the costs themselves after receiving late notice of a sharp funding cut, it has been confirmed.

Critics say the confusion and financial burden on participants grew because aT told them early in the year that the program would continue, only for support to be drastically reduced without adequate warning.

According to data submitted to Democratic Party of Korea lawmaker Moon Dae-rim of the National Assembly's Agriculture, Forestry, Livestock, Fisheries and Food Committee, funding for the overseas benchmarking support program for specialized agricultural production complexes plunged from 523 million won ($386,000) last year to 63 million won this year.

The number of complexes receiving support also fell sharply, from 41 last year to just five this year. In 2023, 47 complexes received a combined 534.19 million won, and in 2024, 45 complexes received 572.41 million won. aT had supported around 40 complexes annually for years, making this year's allocation roughly one-eighth of the usual level.

The core problem is that some farming cooperatives began preparing for overseas training before the funding cuts were adequately communicated to them.

According to accounts from the Assembly committee and participants, aT's regional offices held information sessions early this year and told attendees the overseas benchmarking program would proceed as usual. Some complexes say they were never specifically told that support would be cut significantly from the previous year.

With fuel surcharges and other costs in mind, some farming cooperatives and agricultural associations began booking flights and accommodation as early as April and May. They say they were not notified that funding had been reduced or that their applications had not been allocated a budget until around July.

aT has attributed the delayed notification to a late finalization of its detailed program budgets, saying the budget for individual sub-programs — including the overseas benchmarking trips — was only confirmed around June. An aT official told Moon's office that the corporation was unaware that some complexes had already booked flights and accommodation in April and May to lock in lower fuel surcharges before the sub-program budgets were finalized.

By the time participants learned of the cuts, bookings were already in place, leaving them with cancellation fees and out-of-pocket expenses. The total cancellation-related costs for four complexes that called off their trips came to 15.4 million won, ranging from 900,000 won to 6.5 million won per complex. However, that figure includes both fees already paid and projected fees, so the two categories need to be distinguished.

Another 15 complexes proceeded or are proceeding with overseas training entirely at their own expense. Given that the average support per complex last year was about 12.76 million won, the financial burden now falling on individual farming cooperatives and agricultural associations is substantial.

In one case, a farming cooperative covered the cost of benchmarking overseas best practices out of its own funds after receiving no program budget allocation. Another agricultural cooperative paid for overseas training it had already completed in the first half of the year from its own resources. One limited liability company canceled the participation of some farm household members and covered the remaining costs itself.

One horticultural agricultural cooperative had already completed an overseas benchmarking trip in July but is struggling to settle its accounts because no support budget was allocated. Another cooperative postponed its overseas benchmarking visit to October due to the budget cuts and faces potential cancellation fees if it does not receive an additional allocation.

The pattern of repeated support to the same complexes also raised expectations in the field, critics say. Of the 66 complexes that received support between 2022 and last year, 44 had received it at least twice. Eighteen had received support three times, and 10 had received it for four consecutive years.

The fact that the program was announced as continuing cannot itself be taken as a guarantee of funding. However, critics argue that if aT knew support would be drastically reduced, it should have communicated that clearly before farming cooperatives and associations spent money on flights and accommodation — particularly given that many had come to expect continued support based on years of repeated participation.

"Support levels can be adjusted based on budget conditions, but notifying participating complexes of the cuts only after they had already booked flights and accommodation is a clear administrative failure on aT's part," Moon said. "aT must immediately assess the damage suffered by complexes that were left paying cancellation fees or out-of-pocket costs due to the late notification, and put in place a reasonable remedy."

Moon added that if the practice of repeatedly supporting the same complexes has become entrenched, the program's structure itself needs to be reformed. "Rather than continuing to support only established high-performing complexes, we need to identify new farming cooperatives and agricultural associations and develop them into competitive export complexes," he said. "I will push for systemic reform through the national audit."