IMPORTANCE
The U.S.-Republic of Korea Free Trade Agreement (FTA) will add hundreds of millions of dollars to the U.S. pork industry in additional pork exports. The agreement will benefit all U.S. pork producers, because exports positively affect the price of live hogs. According to Iowa State University Economist Dermot Hayes, this trade agreement when fully implemented will cause live U.S. hog prices to be $10 higher than would otherwise have been the case. U.S. pork products currently face significant tariffs in South Korea. For example, the current South Korean duty on bellies, a high demand pork product, is 25 percent. However, under the terms of the U.S.-Republic of Korea FTA tariffs will be eliminated on all frozen and processed pork products by 2014. Fresh chilled pork will be duty free ten years after implementation with a safeguard. In addition to ambitious market access gains, the Republic of Korea has agreed to accept all pork and pork products from USDA approved facilities. This provision ensures trade will be possible without onerous technical or sanitary barriers.

The U.S.-Republic of Korea FTA will give U.S. pork preferences in this lucrative market over other foreign competitors.  The United States is the largest foreign supplier of pork to South Korea. Major competitors include the European Union, Canada, Chile and Australia.

BACKGROUND
Trade negotiations between the United States and South Korea were successfully completed April 1, 2007. South Korea currently is the 7th largest export market for U.S. pork. U.S. pork exports to Korea have increased as a result of concessions made by Korea in the Uruguay Round. In 2008, exports climbed to 133,532 metric tons valued at $284 million, an increase of 665 percent by volume and 766 percent by value since implementation of the Uruguay Round. Exports to the Republic of Korea in 2008 grew aggressively over 2007 exports—34 percent increase in volume terms and a 23 percent increase in value terms.  This trade agreement is still pending U.S. congressional approval.

NPPC POSITION
NPPC strongly supports congressional passage and implementation of the U.S.-Republic of Korea FTA. U.S. pork producers will benefit significantly from the increased exports that will result from this trade agreement.

International Trade Press Releases

International Trade Testimony & Comments

Letter from Former Secretaries of Agriculture To Members of the U.S. House of Representatives and the U.S. Senate On the Korea-U.S. Free Trade Agreement