March 20, 2012

The launch of the Korea-US Free Trade Agreement (KORUS) was well received by the US Dairy Export Council (USDEC) and the National Milk Producers Federation (NMPF).

Korean consumers will now have greater opportunities to access high-quality dairy products from the US.

"The US has become an important supplier of cheese and other dairy products to Korea over the last few years," said Tom Suber, president of USDEC, which along with the National Milk Producers Federation (NMPF) took the lead role in working with US government officials to represent industry interests during trade negotiations.

"We believe KORUS provides a valuable opportunity for our members to strengthen their ties to Korea and for us to work with the broader Korean dairy industry to grow consumption of dairy products."

The FTA provides immediate zero tariff access for whey for feed use, as well as duty-free access for a total of 16,000 tonnes of cheese, milk powders, whey for food use and other products. The agreement also calls for most of Korea's remaining tariffs to be phased out in five to ten years.

"The first-year access alone that KORUS provides for dairy food products equates to 270 million pounds of US-produced milk. That's 4,435 loads of milk coming from America's hard-working dairy farmers to meet Korea's growing demand for safe and nutritious dairy products," said Jerry Kozak, president and CEO of NMPF.

Suber further praised the benefits of the FTA, noting that: "The access this agreement provides will not only help our exporters better serve the demands of the Korean market, but also will play a key role in helping alleviate price inflation in Korea by expanding the range of affordable food supplies."

Consumption of US dairy products in Korea has risen steadily. US cheese exports to Korea grew 75% in 2011, reaching nearly 72 million pounds, making the US the largest supplier with a 43% market share. KORUS is expected to further encourage this trend as the terms of the FTA come into effect and ultimately influence food prices in Korea.