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The U.S.-Korea Free Trade Agreement (KORUS FTA) will provide America’s
farmers, ranchers, food processors, and the businesses they support with
improved access to the Republic of Korea’s 49 million consumers. If approved by
Congress, this would be the most economically significant trade agreement for
the U.S. agricultural sector in 15 years.
Under this agreement, more than 60 percent of U.S. agricultural exports will
become duty free immediately. Lower tariffs benefit both U.S. suppliers and
Korea’s consumers. The KORUS FTA will help the United States compete against
Korea’s other major agriculture suppliers and help keep the United States on a
level playing field with Korea’s current free trade partners, such as Chile, and
any future FTA partners.
This fact sheet contains information about a range of vegetables and related
products (with the exception of potatoes, which are in a separate fact sheet).
Additionally, a summary chart of tariff reductions for these products is
included.
Frozen Sweet Corn
With the Agreement…
The current 30-percent tariff on frozen sweet corn will be eliminated within
5 years.
The Trade Situation…
Korea is the fourth largest import market for U.S. frozen sweet corn. From
2004 through 2006, U.S. suppliers shipped on average 1,700 tons a year of frozen
sweet corn to Korea valued at $691,000. The U.S. share of Korea’s growing import
market averaged 28 percent and has increased over the past several years. The
United States is Korea’s largest supplier, but faces strong competition from
China.
The Current Market Access Situation…
Although U.S. frozen sweet corn is currently subject to a 30-percent tariff,
Korea’s WTO bound duty is 54 percent. Under the FTA, Korea will not be able to
increase the tariff for U.S. imports from the current levels up to the WTO-bound
level.
Asparagus, Carrots, and Onions
With the Agreement…
Fresh asparagus will be duty free upon implementation of the agreement. The
30-percent tariff on fresh carrots will be phased out in 5 years.
For onions, the KORUS FTA establishes a 2,904-ton safeguard in year 1 that
increases to 5,808 tons in year 16, subject to a 50-percent duty. Quantities
over the quota amount are initially subject to an over-safeguard duty of 135
percent that expires in year 19, and at that time, all quantities enter duty
free.
The Trade Situation…
Korea is the 13th largest market for U.S. asparagus and the United States is
the fifth largest supplier to Korea with a 12-percent average market share
during 2004-2006. During that period, the United States shipped an annual
average of 188 tons valued at $1 million. Korea is the seventh largest market
for U.S. onions. From 2004 through 2006, U.S. suppliers shipped on average 4,605
tons a year of onions to Korea valued at $2 million. Korea imports onions in
years when the domestic industry cannot meet demand. So, imports vary widely
from year-to-year depending upon the local crop.
The Current Market Access Situation…
U.S. asparagus is subject to a 27-percent tariff and carrots are subject to a
30-percent tariff. Imports of onions are subject to a global WTO TRQ of 20,645
tons at an applied duty of 50 percent and a 135-percent out-of-quota (bound)
duty.
Lettuce
With the Agreement…
The 45-percent tariff on fresh lettuce will be eliminated in 10 years. The
FTA should help U.S. producers maintain their position as the top supplier of
lettuce to Korea.
The Trade Situation…
Korea is the seventh largest market for U.S. lettuce. From 2004 through 2006,
U.S. suppliers shipped an annual average of 997 tons of lettuce to Korea valued
at $839,000. The U.S. share of Korea’s growing import market for lettuce
averaged 55 percent, and it has increased sharply over the past several years.
U.S. lettuce faces strong competition from China, which also supplies about half
of the import market.
The Current Market Access Situation…
U.S. lettuce is subject to a 45-percent applied duty.
Peas
With the Agreement…
The KORUS FTA will lock in the duty-free access being enjoyed by U.S.
feed-use pea exporters. The 27-percent tariff on seed peas will be phased out
over 5 years. For all other peas, except those for feed use, the tariff will be
phased out over 10 years.
The Trade Situation…
From 2004 through 2006, U.S. suppliers shipped an annual average of 5,000
tons of dry peas valued at $1.5 million. The U.S. share of Korea’s import market
is 85 percent and has remained largely unchanged. The FTA should keep the United
States on top in this competitive market.
The Current Market Access Situation…
U.S. dry peas enter Korea duty free under an autonomous TRQ of 450,000 tons.
The out-of quota tariff is 27 percent. U.S. fresh and frozen peas trade under a
27-percent tariff. U.S. prepared or preserved peas trade under a 20-percent
tariff.
Selected Vegetable Tariff and Trade Data
|
Product |
Current Tariff |
Phase-out (years) |
Average Yearly Imports 2004-06 (tons) |
Average Yearly Imports 2004-06 ($mil) |
U.S. Market Share 06 By Volume |
|
Cabbage |
27% |
Immediate |
0 |
$0 |
< 1% |
|
Cucumbers |
27% |
Immediate |
0 |
$0 |
< 1% |
|
Fresh Asparagus |
27% |
Immediate |
22 |
$0.13 |
8% |
|
Celery |
27% |
Immediate |
23 |
$0.04 |
16% |
|
Chicory |
8% |
Immediate |
62 |
$0.27 |
77% |
|
Prepared or Preserved Tomatoes |
8% |
Immediate |
1,984 |
$1.29 |
36% |
|
Carrots |
30% |
5 |
145 |
$0.34 |
< 1% |
|
Dried Mushrooms |
30% |
5 |
4 |
$9.58 |
< 1% |
|
Frozen Sweet Corn |
30% |
5 |
148 |
$0.15 |
27% |
|
Prepared or Preserved Sweet Corn |
30% |
5 |
21,767 |
$24.56 |
60% |
|
Cauliflower/Broccoli |
27% |
5 |
57 |
$0.24 |
1% |
|
Cabbage, Chinese |
27% |
5 |
0 |
$0 |
< 1% |
|
Fresh and Frozen Peas |
27% |
5 |
67 |
$0.06 |
25% (fresh), 35% (frozen) |
|
Potatoes – Frozen Fries |
18% |
5 |
26,430 |
$22.80 |
89% |
|
Dried Peas (not for seed) |
0% or 27% |
10 |
3,141 |
$1.01 |
85% |
|
Cabbage Lettuce |
45% |
10 |
256 |
$0.29 |
41% |
|
Other Lettuce |
45% |
10 |
811 |
$0.64 |
61% |
|
Kidney Beans (not for seed) |
27% |
10 |
1,905 |
$0.62 |
10% |
|
Prepared or Preserved Asparagus |
20% |
10 |
13 |
$0.04 |
35% |
|
Garlic |
360% or 50% |
19 |
4 |
$0.02 |
1% |
|
Onions |
135% or 50% |
19 |
4,277 |
$2.64 |
6% |
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