The Obama Administration has completed its review of the free trade agreement between the U.S. and South Korea. The agreement will take effect on March 15, when nearly two-thirds of U.S. agricultural exports to Korea will become duty-free, including U.S. soybeans for crushing and U.S. soybean meal.

Additionally, U.S. food-grade soybean producers will have access to the South Korean market for the first time outside of the import monopoly created by the Korean State Trading Enterprise. The implementation of the agreement will also trigger the gradual elimination of tariffs on refined soybean oil over five years, and the elimination of tariffs on crude soybean oil over 10 years.

The American Soybean Association & National Corn Growers Association are among many who are excited about the agreement being implemented.

“This free trade agreement creates landmark opportunities for soybeans and other U.S. agricultural exports, including meat and poultry,” said ASA President Steve Wellman, a soybean farmer from Syracuse, Neb. “Trade agreements that significantly improve access to foreign markets for these products are a main focus of ASA’s efforts in Washington, and we appreciate the efforts of the administration, the Office of the U.S. Trade Representative, and USDA in seeing the free trade agreement with South Korea enacted next month.”

“We are very pleased to see the USTR announce movement on the U.S.-Korea FTA,” said Chad Blindauer, Chair of NCGA’s Trade Policy and Biotechnology Action Team.  “Full implementation of all three free trade agreements that were passed by Congress last October will help support thousands of jobs throughout America. Developing new markets for our country’s agricultural products is vital to producer income and also helps our sector lead the nation in economic growth and international competitiveness.”

Soybeans and soybean products are the largest U.S. export commodity, totaling nearly 1.5 billion bushels in 2011, with a value of more than $22 billion. In that same year, South Korea imported $362 million worth of soybeans and soy products from the United States, making it the eighth largest U.S. soybean export market. South Korea also purchased $1.2 billion in meat products from the United States in 2011, making it a large and growing market for U.S. meat producers.

The National Cattlemen’s Beef Association was also pleased to see the agreement go through. This is part of the statement they released:

“When the KORUS FTA is implemented, our competitive advantage will be secured. The KORUS pact will phase out tariffs on U.S. beef over the next 15 years and will make U.S. beef a more affordable and appealing choice for our valued Korean customers. This may very well be the most monumental bilateral trade pact our industry has ever witnessed. With increasing demand and tightening supplies, movement of the KORUS FTA should encourage cattlemen and women to think beyond the current prices for live cattle and think long term.”

Passage last year of the free trade agreements with Korea, Colombia and Panama represented the largest trade package since Congress passed the North American Free Trade Agreement in 1993. Statistics show full implementation of the agreements will result in an estimated $2.3 billion in additional agricultural trade in 2012 and beyond.  In addition, nearly 20,000 domestic jobs will be supported.

Source: ASA & NCGA & NCBA