At the G-20 summit in Toronto this past weekend, President Barack Obama signalled his intention to set a deadline for removing outstanding obstacles to the implementation of the agreement and gain Congressional approval of the deal in 2011. US Trade Representative Ron Kirk will be tasked with negotiating with his Korean counterpart to work out the details by the next G-20 meeting, which will be held in Seoul, South Korea, in November.

 

"The free trade agreement with South Korea would provide landmark opportunities for US soy, meat, and poultry exports," said ASA President Rob Joslin, a soy producer from Sidney, Ohio. "The agreement is very positive because it will further open South Korea's market to US exports of soy and soy products."

 

The agreement offers immediate duty-free access to US soy for crushing and to US soymeal. And for the first time, producers of US food-grade soy would have access to the South Korean market outside of the import monopoly created by the Korean State Trading Enterprise. Tariffs on refined soyoil would be eliminated over five years, and tariffs on crude soyoil would be eliminated over 10 years.

 

"US soy growers will also benefit because this agreement is expected to generate millions of dollars in additional exports of meat and poultry," Joslin said. "Domestic livestock consumed more than 24 million tonnes of soymeal in 2009, which was 70% of all the soymeal processed in this country."

 

The agreement has been awaiting action by Congress on the necessary implementing legislation. That legislation has been held up by demands from some lawmakers that improvements be made to the agreement in certain sectors, including automobiles.

"ASA is encouraged that the President's deadline will motivate negotiators to resolve any outstanding issues," Joslin said. "Ratification of this trade agreement is long overdue."

 

In 2009, South Korea imported US$449 million worth of soy, soymeal and soyoil from US. The South Korean market is now the fifth largest for US agricultural exports, valued at US$3.9 billion in 2009. According to economic analysis by the American Farm Bureau Federation, the Korea FTA would expand those exports in a wide range of commodities and result in US$1.8 billion in additional sales, a 46% increase.

 

"ASA supports negotiation of trade agreements that significantly improve access to foreign markets for US soy and livestock products," Joslin said. "US soy farmers benefit from free trade because more than half the value of the US soy crop is exported annually."

 

The KORUS FTA is one of three that are pending approval by Congress. Agreements with Colombia and Panama also have been awaiting action for more than three years. ASA is calling for action on all three FTAs, pointing out the enormous risk of letting other countries move forward first.