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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.

Korea’s tariffs of 20 percent on imports of the dominant frozen leg quarter import category will be phased out in 10 equal annual reductions; frozen breasts and wings will be phased out in 12 equal reductions. Korean tariffs on frozen turkey cuts will be phased out in seven equal annual reductions from the current 18 percent.

Korean tariffs of 27 percent on egg products, including egg yolks, will be phased out in 12 equal annual reductions. The cumulative tariff savings resulting from KORUS FTA for these poultry and egg products is estimated at almost $9 million over the first 5 years of the agreement.

Korea’s most significant poultry meat imports are frozen chicken cuts such as legs and wings, followed by frozen turkey cuts such as legs and wings. The United States is the leading supplier, with an average market share of 54 percent. After the United States, Brazil and the European Union are the leading suppliers.

Korea is an important market for U.S. leg quarters and legs. From 2005 through 2007, U.S. exports to Korea have rebounded and averaged $41 million annually. During 2007, the U.S. share of Korea’s chicken leg import market reached 45 percent. For turkey parts, the U. S. captured 93 percent of the $5.4 million market.

Korea was the number five market for U.S. egg products (egg yolks) with imports averaging $2.7 million annually from 2005 through 2007. U.S. products captured an average 60 percent of the Korean market during this time.

U.S. leg quarters face applied tariffs as high as 18 percent, and the WTO permits (bound) duties as high as 20 percent. Korea’s current tariffs for poultry and egg products range from 18 to 42 percent. Korea agreed to begin a risk assessment process in June 2007 to evaluate acceptance of U.S. regionalization in the event of future avian influenza detections in the United States.