NongHyup Launches Comprehensive Innovation in Agricultural Product "Production-Distribution-Sales" System... "Aiming to Usher in the Era of 30 Million Won Farm Income"

Boosting Farmers' Income and Revitalizing Economic Businesses

Restructuring the 'Production-Distribution-Sales' System with a Focus on Farmers' Interests

Shifting Wholesale and Retail Distribution to Online Platforms

NongHyup has announced plans to restructure the agricultural product "production-distribution-sales" system with a focus on practical benefits for farmers in order to boost their income and revitalize economic operations. The company aims to enhance farmers' bargaining power by expanding collective business initiatives, while also restructuring NongHyup's wholesale and retail distribution operations to center around online channels to mitigate price volatility.

On July 15, NongHyup stated that it will embark on a comprehensive innovation spanning the entire agricultural product value chain—from production to distribution and sales.

Specifically, NongHyup will focus on: ▲ reorganizing the production-distribution-sales system around farmers, ▲ transitioning wholesale and retail distribution operations to online channels, ▲ digitalizing production facilities at the production sites, and ▲ broadening collaboration with government policy programs. Through these initiatives, NongHyup plans to develop a distribution system that ensures fair compensation for farmers and provides consumers with products they can trust.

First, the production-distribution-sales system will be remodeled to prioritize the practical interests of farmers. At the production stage, NongHyup will expand exclusive shipment contracts at production sites, enabling volume aggregation and boosting bargaining power to help restore farmer-led price determination. The company will nurture highly capable, production site-based shipment organizations and expand collective regional business projects, such as joint marketing initiatives for each product category.

At the distribution stage, the intention is to minimize intermediary distribution margins, thereby improving the prices received by farming households. Direct transactions between production sites and consumers will be expanded, and the Urban-Rural Cooperative Market—which facilitates mutual cooperation between city and rural NongHyup branches—will be promoted nationwide. At the sales stage, the plan is to maximize the added value of agricultural products to help increase farm income. NongHyup will develop “mega hit products” utilizing its own food processing plants, and expand collaborative business-to-business transactions (such as joint development and marketing of agri-foods) with companies in the food service sector, among others. Hanaro Mart will establish a comprehensive consulting division and, through core store strategies and other measures, work to improve the efficiency of distribution operations while also invigorating agricultural product sales.

NongHyup’s wholesale and retail distribution functions will be restructured with a focus on online platforms. Wholesale markets, which have previously relied on auction-based transactions, will be converted to an online pre-order pricing transaction model, where sellers and buyers agree in advance on conditions like price and volume before goods enter the wholesale market. A dedicated team will be established for this purpose, and, in response to the rapidly changing online market, NongHyup aims to increase the supply of domestically produced agricultural goods while also striving to stabilize price volatility.

The digitalization of production and distribution facilities at production sites will also be promoted. Business processes such as receipt and shipping at local Agricultural Produce Collection (APC) centers will be computerized, laying the foundation for data-driven economic operations. Out of a total of 423 agricultural product distribution centers nationwide (as of the end of 2025), NongHyup plans to expand the number of smart APCs to 100 by 2027 and support the automation of facilities in 240 NongHyup APCs through a facility modernization initiative.

In addition, NongHyup will shift from a previous focus on bulls to a cow improvement system based on Hanwoo genome analysis, accelerating livestock improvement through the selection of superior cows and the supply of high-quality embryos and calves. The integrated management platform for Hanwoo production information, “NH Hanaro Ranch,” will be enhanced to offer integrated information management and data-based customized consulting, contributing to increased farm productivity and income. Furthermore, an AI-based smart slaughtering system will be introduced to wholesale markets to improve work efficiency and quality control standards.

As a government partner in agricultural policy, NongHyup will also strengthen its linkage to policy programs designed to revitalize agriculture and rural communities. Annually, around 2,200 farms will receive dissemination-model smart farms suited for small and medium-sized farms. To address food deserts, NongHyup will expand its mobile markets, and through participation in food care programs—such as eco-friendly agricultural products for pregnant women and fruit snacks for children—it also aims to reinforce the national food safety net.

A NongHyup representative stated, “Through this innovation, which encompasses the core strategies for revitalizing NongHyup’s economic operations, we aim to improve the practical benefits for farmers and the convenience for consumers. By accelerating innovation throughout the entire production-distribution-sales process, we plan to usher in the era of 30 million won in farm income.”

This content was produced with the assistance of AI translation services.