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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, the average agricultural tariff for U.S. goods will fall from 52 percent to 4 percent in 15 years. 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.

While there is no additional market access for rice in the KORUS FTA, rice exporters currently benefit from the rice agreement that the United States negotiated with Korea in 2004 under the WTO Minimum Access Agreement. Under the WTO agreement, U.S. exporters enjoy guaranteed market access for 50,076 tons of rice annually under a country-specific quota in Korea’s tariff schedule. U.S. exporters are also able to compete for additional quantities under the global portion of Korea’s rice quota. Under this global quota, Korea purchased 71,000 tons, the highest level of U.S. rice imports since Korea assumed its WTO minimum market access obligations in 1995. The 2004 agreement requires that Korea distribute some U.S. rice to consumers instead of selling it all for industrial use. The 2004 rice agreement expires in 2014, at which time the United States will negotiate for additional access for rice. The United States continues to push for greater access to Korea’s rice market in the Doha negotiations.

From 2005 to 2007, U.S. suppliers shipped on average 56,000 metric tons of rice valued at $29.3 million. The current U.S. share of the Korean import market is 26 percent. The United States faces competition from China and Thailand for rice purchases under the global quota.

U.S. rice faces a country-specific quota of 50,076 tons with an applied tariff of 5 percent. The U.S.-specific share falls within an absolute quota of 266,269 tons in 2007 that will grow incrementally to 407,800 tons in 2014. The WTO bound tariff rate is the same as the applied rate.