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The United States concluded free trade negotiations with
Korea on April 1, 2007. The U.S.-Korea Free Trade Agreement (KORUS FTA) is the
most commercially significant free trade agreement the United States has
negotiated in nearly 20 years.
The KORUS FTA provides immediate elimination of duties
on more than 60 percent of current U.S. exports and gives U.S. exporters
improved access to the Korean market for many of the products that have been
highly protected. The U.S. International Trade Commission estimates that annual
U.S. agricultural exports to Korea will increase by a minimum of $1.9 billion
upon full implementation of the agreement.
The agreement eliminates tariffs and other barriers on
most agricultural products, increasing export opportunities for a range of
Alaska’s agricultural products, including beef and dairy. Alaska’s agricultural
exports to all countries, estimated at $4 million in 2006, supported jobs both
on and off the farm. These export sales make an important contribution to the
Alaska farm economy, which had total cash receipts of $64 million in 2006.
Beef. Alaska’s cattle
and calf industry generated about $2 million in farm cash receipts in 2006 and
will benefit from this agreement.
For beef muscle meats, the FTA provides a 15-year
straight-line tariff phase out with a safeguard that begins growing from
270,000 tons, a quantity that is 17 percent larger than our largest
historical shipments.
Technical consultations continue toward the goal of
allowing imports to take place consistent with World Organization for Animal
Health (OIE) guidelines.
Following the May 2007 decision by the OIE
classifying the United States as a controlled-risk country, Korea has
announced that it will undertake in a timely manner its regulatory process
toward expansion of market access for beef and beef products.
Dairy. The dairy
industry provides Alaska with its third largest source of farm cash receipts,
about $2.6 million in 2006. As such, Alaskan dairy producers will benefit from
this agreement.
The FTA will provide immediate duty-free access for
double the current export volume of total dairy products. Duty-free quotas
will be established for cheese, skim/whole milk powder, food whey, and
butter.
Current annual U.S. feed whey exports of $8 million
will gain duty-free access to the Korean market immediately upon
implementation.
Vegetables. Alaskan
potato growers earned about $2.3 million in 2006 and will benefit from this
agreement.
Tariffs on frozen potato fries and chipping
potatoes (during the U.S. potato shipping season) will become duty free
immediately.
A new 3,000-ton duty-free quota for fresh potatoes
and a new 5,000-ton duty-free quota for dehydrated potatoes will bring
opportunities for growers.
For questions about the U.S.-Korea Free Trade Agreement and its impact on
U.S. agriculture, please contact FAS Legislative and Public Affairs Office at
(202)720-7115 or
LPA@fas.usda.gov.
For detailed information on how the Agreement benefits specific commodities,
please visit:
http://www.fas.usda.gov/info/factsheets/Korea/us-koreaftafactsheets.asp.
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U.S.–Korea Free Trade
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