The Korea Fair Trade Commission (KFTC) has launched a formal review into alleged price collusion among seven leading wheat flour manufacturers and sellers in South Korea. The investigation aims to address concerns over repeated agreements on sales prices and volume allocation, which may have violated fair trade laws. The KFTC’s Secretariat submitted an examination report to both the companies involved and the Commission, marking the start of the deliberation process. The report outlines the findings and recommended corrective actions but does not bind the Commission’s final decision.
The companies under investigation include Daesun Flour Mills, Daehan Flour Mills, Sajo Dongawon, Samyang Corporation, Samhwa Flour Mills, CJ CheilJedang, and Hantop. These firms collectively hold approximately 88% of the domestic B2B wheat flour market as of 2024. The alleged collusion affected direct transactions with large buyers such as ramen, bakery, and confectionery manufacturers, as well as indirect sales through agents to smaller buyers. The estimated sales impacted by these practices amount to about 5.8 trillion won.
The investigation began in October 2025 and continued for four and a half months, concluding in February 2026. The period of alleged collusion spans from November 2019 to October 2025, with repeated agreements on pricing and volume. The KFTC’s examiner determined these actions violated Article 40, Paragraph 1, Items 1 and 3 of the Fair Trade Act, recommending corrective orders and fines. The Commission may impose fines up to 20% of the affected sales, and prosecutors have already filed charges against the companies and 14 executives as of January 2026.
Companies have eight weeks from receipt of the examination report to submit written opinions and request access to evidence, ensuring their right to defense. The KFTC will make its final decision after these procedures. Frequently asked questions include: What penalties could be imposed? The Commission may levy fines up to 20% of the affected sales. How does this affect consumers? The investigation aims to stabilize prices and restore fair competition in the wheat flour market.
The Korea Fair Trade Commission’s action against alleged wheat flour price collusion is a decisive step toward market transparency and consumer protection. By investigating companies that control a large share of the B2B market, the Commission addresses both direct and indirect impacts on food manufacturers and smaller buyers. The structured review process, including defense rights and potential fines, underscores the importance of fair competition. The outcome of this case may set a precedent for future enforcement and contribute to price stability in essential food sectors.