Between 26 and 30 percent of U.S. farm cash receipts come from agricultural exports, making foreign markets critical to American farmers, ranchers, and agriculture-related businesses. Today, farm exports help support more than 1 million American jobs. The entry into force of the KORUS FTA on March 15, 2012 will help further expand U.S. agricultural exports through improved access to the important Korean market.
The FTA with Korea is the most commercially significant trade agreement for the United States since the NAFTA. Korea is now the world’s 12th largest economy, with a GDP of over $1.4 trillion and a population of about 49 million. The U.S. International Trade Commission estimates that increased U.S. exports resulting from the reduction of Korean tariffs and tariff-rate quotas on U.S. industrial and agricultural goods alone will add $10 billion to $12 billion to annual U.S. Gross Domestic Product and around $10 billion to annual merchandise exports to Korea.
Korea is already the fifth largest export market for U.S. farm products. The KORUS FTA is expected to expand those sales even further by providing America’s farmers, ranchers, food processors, and the businesses they support with improved access to the Korean market. According to the American Farm Bureau Federation, American farm exports to Korea will increase by as much as $1.8 billion every year under the U.S.-Korea trade agreement.
Under the Agreement, Korea will eliminate its tariffs or taxes on imported products on almost two-thirds of U.S. farm products exports immediately. These products include such important U.S. exports as wheat, corn, soybeans for crushing, whey for feed use, hides and skins, cotton, cherries, pistachios, almonds, orange juice, grape juice, and wine. Other U.S. products including skim milk powder, whey for food use, cheese, dextrins and modified starches, barley, popcorn, soybeans for food use, dehydrated and table potatoes, honey, and hay will benefit from immediate duty-free access within new tariff-rate quotas (TRQs).
You can learn more about the KORUS FTA and its benefits from the following websites:
The Office of the United States Trade Representative: U.S. Korea Free Trade Agreement
USDA Foreign Agricultural Service: U.S.-Korea Trade Agreement
Export.gov: Why a U.S. Korea Trade Agreement
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