SEOUL (AFP) - South Korea has launched a probe into allegations that dozens of North Korean refugees were being held by rebels in Myanmar and forced to work on a drug farm, activists said on Friday.

The investigation followed a report that 64 refugees were taken to a rebel camp north-east of Tachilek, a town along the border between Myanmar and Thailand.

The refugees were caught while attempting to travel to Thailand after fleeing their poverty-stricken homeland, Yonhap news agency said.

South Korean activist Kim Hee Tae told Yonhap the refugees were forced to work at a rebel-controlled drug farm, with male captives used for poppy growing and women for drug processing or alcohol manufacturing.

Kim, who is working for a Seoul-based group to improve human rights in the North, said the rebels were asking for US$5,000 (S$6300) for each of the hostages and sought the government's help in securing their release, according to Yonhap.

The news agency did not specify which rebel group were involved.

"A related government agency is now working to ascertain the truth of such a report," South Korean Unification Ministry spokesman Kim Hyung Suk told reporters.

Myanmar is the world's second largest producer of opium - the raw ingredient for heroin - after Afghanistan, accounting for 10 per cent of global production, according to UN data.

Since the end of the Korean War in 1953, some 25,000 North Korean refugees have escaped and settled in the South.

Most begin their journey by crossing into China, where they face repatriation if caught.

They then try to reach a second country, with Thailand the most popular choice, from where they generally seek permission to resettle in South Korea.

Those who are caught and deported back to the North face severe punishment, including a jail term at a labour camp, rights groups say.