The eyes of the world are on South Korea this week as the greatest athletes in winter sports compete for gold. But there are many more reasons beyond their love of figure skating, curling and skiing that American farmers are paying close attention to South Korea.
With 51 million citizens, South Korea is the 27th most populous country in the world, larger than Spain, Argentina and Canada. Its growing middle class has been increasing purchases from the United States. The United States is now the country’s top agricultural supplier, providing 28 percent of incoming products. Much of this growth has been linked to implementation of the Korea Free Trade Agreement — aka KORUS — that went into effect in 2012.
This agreement is one of the newest free trade agreements in place between the United States and a bilateral partner, but it has drawn significant criticism from President Donald Trump, who has characterized it as “a horrible deal.”
Much of the criticism of KORUS in America has centered on automobile trade, as South Korean brands such as Hyundai, Kia and Daewoo continue to gain market share around the world and increase concerns among American automakers. American agricultural groups were unhappy with the last-minute exclusion of rice from KORUS negotiations and the lengthy 15-year phase-out of beef tariffs, but it has otherwise been a very popular agreement among farmers and ranchers.
After six months of saber-rattling and threatening to pull out of KORUS altogether, in October the Trump administration and the South Korean government agreed to renegotiate portions of KORUS. Initial signals from the Trump administration indicate this will not be a full renegotiation, but rather a less-complicated amendment to the original agreement. Hopefully this stays true for agriculture, as American farmers and ranchers gained significant access to the Korean market with the KORUS agreement.
KORUS immediately eliminated duties on nearly two-thirds of U.S. agricultural exports to South Korea, and many more were phased out. This caused U.S. prepared food exports to South Korea to jump 57 percent over the next four years, reaching $423 million in 2016. Beef imports have increased 82 percent, making South Korea the No. 2 importer of U.S. beef products, behind Japan. Tariffs on corn imported from the United States immediately dropped to zero from 328 percent, making the country the third-largest importer of U.S. corn today.
No trade deal is perfect, and we can make gains in a renegotiation. But as with the North American Free Trade Agreement and numerous other free-trade agreements, the first job of negotiators should be to figure out what’s already working and then strive to do no harm. Agriculture has done well under KORUS and Trump should take care to only make changes that benefit our farmers and ranchers.
Eric Bohl is director of public affairs for the Missouri Farm Bureau. He can be reached at email@example.com.
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