Four manufacturers of starch and starch sugar, key raw materials used in food products such as bread and beverages, have been caught colluding on prices for more than seven years, drawing a record fine of 750 billion won. The Fair Trade Commission (FTC) has also launched sanctions proceedings against separate cases of bid-rigging and byproduct price-fixing in the starch sugar sector. As a result, observers say total fines related to the starch and starch sugar collusion cases could exceed 1 trillion won.
The FTC said Monday that it had imposed corrective orders along with a total of 747.6 billion won in fines on Daesang, Sajo CPK, Samyang, and CJ CheilJedang for colluding on the sales prices of starch and starch sugar over seven years and five months, from May 2018 to October 2025.
This is the largest fine ever imposed by the FTC for collusion. The previous largest penalty was in the flour cartel case involving seven companies, at 671 billion won.
According to the FTC, the companies jointly determined price increases and decreases on a total of 13 occasions. When international corn prices rose, they raised prices together to quickly pass on higher costs to their clients, and when prices fell, they delayed the timing of reductions or minimized the size of the cuts. These companies hold a 95.7% share of the starch market and an 86.4% share of the starch sugar market in Korea's business-to-business (B2B) market.
In particular, although the government applied a 0% tariff quota on corn for processing in response to soaring international grain prices, easing the industry's cost burden, the companies continued their collusion during this period by jointly setting the timing of price increases and decreases. As a result, the sales price of starch sugar rose by up to 73% compared with May 2018, when the collusion began.
The FTC judged that this price-increase burden was passed on to final consumers through clients such as food companies. In particular, the four companies passed on the burden of corn price fluctuations to their clients and maximized their unfair gains during a period when the national economy was struggling overall due to COVID-19 and the Russia-Ukraine war. The revenue these four companies earned domestically in this way reached 6.0525 trillion won.
The FTC viewed this as a "very serious violation" and imposed fines of approximately 747.6 billion won, equivalent to 15% of the related sales.
Seeing a high likelihood that the collusion could recur, the FTC also issued an "independent price re-determination order" requiring the companies to independently set their prices anew. The companies must re-determine the prices of starch and starch sugar to pre-collusion levels and report any price changes to the FTC every six months for the next three years. This is the fourth time an independent price re-determination order has been imposed, following the flour cartel case (April 2006, May 2026) and the printing paper cartel sanctions (April 2026). Nam Dong-il, vice chairman of the FTC, said, "This case had a very significant impact on the market overall due to the long-lasting collusion," adding, "It is difficult to conclude that the effect of the prices formed through collusion has been fully resolved, so we imposed both the independent price re-determination order and the obligation to report price changes."
Separately from the price-fixing case, the FTC said the same day that it had also opened review proceedings for cases of starch sugar bid-rigging and byproduct price-fixing. The FTC judged that Daesang, Sajo CPK, Samyang, and CJ CheilJedang had, over a total of eight years and nine months from September 2016 to June last year, predetermined the intended winning bidders, bid prices, and volumes in starch and starch sugar purchase bids placed by seven large end-users, and then allocated the awarded volumes. The related sales in this case are estimated at 940 billion won.
In addition, Daesang, Sajo CPK, and Samyang—excluding CJ CheilJedang—were found to have agreed each month on the sales prices of starch sugar byproducts such as protein skin, gluten, and germ for about eight years, from August 2017 to October last year. The related sales were calculated at 1.55 trillion won.
The FTC viewed both cases as serious violations constituting price-fixing and bid-rigging under the Fair Trade Act, and presented an opinion for corrective orders and the imposition of fines. Following its review, the FTC can impose fines of up to 20% of the related sales. In this case, fines could reach up to 188 billion won for the starch sugar bid-rigging and up to 310 billion won for the byproduct price-fixing.
Considering the record 747.6 billion won already imposed for the starch and starch sugar price-fixing that day, total fines related to starch sugar collusion alone could reach up to about 1.2 trillion won. The final decision on sanctions and the size of the fines will be confirmed following a plenary session review.
