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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, the KORUS FTA 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.
Fresh Cherries
With the Agreement…
Fresh cherries will enter duty free upon entry-into-force of the agreement.
The Trade Situation…
Korea is the fourth largest market for U.S. fresh cherries, and shipments
have steadily risen in recent years. From 2005 through 2007, U.S. suppliers
exported an annual average of 2,240 tons of fresh cherries valued at $14.8
million. The United States dominates Korea’s growing import market with an
average market share of 94 percent.
The Current Market Access Situation…
U.S. fresh cherries face a tariff of 24 percent in Korea.
Fresh Table Grapes
With the Agreement…
U.S. table grape exporters will benefit from greatly improved access to the
growing Korean import market for this product. Front-loaded tariff elimination
for Korea’s domestic off season is expected to benefit an estimated 70 percent
of U.S. grape exports. The tariff on grapes imported October 16 - April 30 will
be 24 percent, down from 45 percent, on the date of the implementation of the
agreement, and will be reduced to zero in four equal annual installments. The
in-season (May 1-October 15) tariff, covering an estimated 30 percent of U.S.
fresh table grape exports, will be phased out over 17 years.
The Trade Situation…
From 2005 through 2007, U.S. suppliers shipped an annual average of 2,922
tons of fresh table grapes valued at $5.4 million. Sales have increased steadily
over the past several years and the United States is the second largest supplier
with a 15-percent market share. Even though Chile currently accounts for 85
percent of Korean grape imports, Chile’s exports are counter-seasonal to, and
therefore have limited impact on, U.S. grape exports to Korea.
The Current Market Access Situation…
U.S. fresh grapes currently face a tariff of 45 percent in Korea.
Raisins and Dried Plums
With the Agreement…
Raisins will enter duty free upon entry-into-force of the agreement, while
the tariff on dried plum imports will be phased out over 2 years.
The Trade Situation…
Korea is the ninth largest market for U.S. raisins, and shipments have
steadily risen in recent years. From 2005 through 2007, U.S. suppliers shipped
an annual average 3,367 tons of raisins valued at $5.1 million. The U.S. share
of Korea’s raisin import market averaged 93 percent by volume from 2005-2007 and
has remained steady over the last several years. There is some limited
competition from Turkey.
From 2005 through 2007, U.S. suppliers shipped an annual average of 601 tons
of dried plums valued at $1.6 million. The United States is the dominant
supplier with a market share of 98 percent by volume which has remained steady.
The Current Market Access Situation…
U.S. raisins face a 21-percent tariff and U.S. dried plums face an 18-percent
tariff.
Grape Juice
With the Agreement…
Grape juice will enter duty free upon entry-into-force of the agreement.
The Trade Situation…
Korea is the third largest market for U.S. grape juice, but sales have been
bouncing around in recent years. From 2005 through 2007, U.S. suppliers shipped
an annual average of 5 million liters of grape juice valued at $6.7 million.
Currently, U.S. share of Korea’s grape juice import market is 38 percent, but
that share has slipped as competition increases. Chile and Argentina have
rapidly increased their presence in the market, and the European Union (Spain
and Italy) is still competitive.
The Current Market Access Situation…
U.S. grape juice faces a 45-percent tariff.
Avocados
With the Agreement…
Korea’s 30-percent tariff on avocados will be phased out over 2 years.
The Trade Situation…
Korea is the fourth largest market for U.S. avocados. From 2005 through 2007,
U.S. suppliers shipped an annual average 287 tons of fresh or dried avocados
valued at $1.1 million. Mexico is the leading supplier, and New Zealand also
exports avocados there.
The Current Market Access Situation…
U.S. avocados face a 30-percent tariff.
Canned Cherries
With the Agreement…
Korea’s 45-percent tariff on canned cherries will be phased out over 10
years.
The Trade Situation…
Korea is the fifth largest market for U.S. canned cherries. From 2005 through
2007, U.S. suppliers shipped an annual average of 1,080 tons of canned cherries
valued at $2.9 million. The U.S. share of Korea’s canned cherry import market is
71 percent, but competitive pressure from China and to a lesser extent the
European Union remains.
The Current Market Access Situation…
U.S. canned cherries face a tariff of 45 percent
Fresh Apples and Pears
With the Agreement…
Korea’s current import tariff of 45 percent on U.S. apples, other than the
Fuji variety, will be reduced to zero in 10 equal annual reductions. The import
tariff on Fuji apples will be phased out in 20 equal annual reductions. The
KORUS FTA also establishes a 9,000-ton safeguard that increases to 12,000 tons
in year 5, and thereafter grows 3 percent compounded annually through year 22.
The safeguard ends for apples other than Fuji in year 11. For Fuji apples, the
safeguard ends in year 23.
Korea’s import tariff on pears, other than the Asian variety, will be phased
out over 10 years, and the tariff for Asian pears will be phased out over 20
years.
Apples and pears were excluded from the FTA that Korea recently concluded
with Chile.
The Trade Situation…
With the lack of a current pest risk assessment, Korea presently prohibits
the importation of any U.S. fresh apples or pears. Korea imports only very small
quantities of apples and pears from foreign suppliers. During non-FTA sanitary/phytosanitary
discussions, Korea did agree to proceed on the long-standing U.S. pest risk
assessment request.
The Current Market Access Situation…
U.S. apples and pears are currently subject to tariffs of 45 percent.
The U.S. Department of Agriculture (USDA) prohibits discrimination in all its
programs and activities on the basis of race, color, national origin, gender,
religion, age, disability, political beliefs, sexual orientation, and marital or
family status. (Not all prohibited bases apply to all programs.) Persons with
disabilities who require alternative means for communication of program
information (Braille, large print, audiotape, etc.) should contact USDA’s TARGET
Center at (202) 720-2600 (voice and TDD).
To file a complaint of discrimination, write USDA, Director, Office of Civil
Rights, Room 326-W, Whitten Building, 1400 Independence Avenue SW, Washington,
DC 20250-9410, or call (202) 720-5964 (voice and TDD). USDA is an equal
opportunity provider and employer.