The Hagstrom Report

Agriculture News As It Happens
Navigation

Vilsack urges ratification of U.S.-Korea trade agreement

Citing the importance of a free trade pact with Korea, Agriculture Secretary Tom Vilsack is urging Congress to ratify the U.S.-Korea agreement before July 1, when a European Union-Korean free trade agreement goes into effect.

The U.S.-Korea agreement would expand farm exports to South Korea by $1.8 billion and support thousands of jobs in the United States, Vilsack said in a media call Tuesday, while helping to put U.S. agriculture ahead of competitors in Asia and strengthen strategic alliances there.

“Congress must move swiftly to ratify the U.S.-Korea Trade Agreement, because if we do not act quickly and decisively, America’s competitors will secure their own trade deals with Korea, and our competitors’ products will achieve an advantage at the expense of American productivity,” Vilsack said.

President Obama should be sending the agreement to Capitol Hill shortly, Vilsack said. Senate Finance Committee Chairman Max Baucus, D-Mont., through whose committee the agreement must move, has said he is not inclined to support the agreement, but Vilsack said he does not believe there is time for any more negotiations with Korea before Congress considers the measure.

Describing the agreement as “more important than the last nine trade agreements” the United States has signed, Vilsack noted that Obama walked away from an initial agreement and did not sign it until Korea made more concessions.

Vilsack said the agreement is being translated. U.S. Trade Representative Ron Kirk is scheduled to testify before Baucus’s committee, Vilsack said, and will address questions about the agreement at that time.

The National Cattlemen’s Beef Association believes Congress should pass the agreement, a spokesman said. The National Farmers Union is usually suspicious of trade agreements, but lobbyist Chandler Goule said over the weekend that the membership will consider supporting this one.

In a news release, Vilsack said the United States provided almost 30 percent of Korea’s total agricultural imports in 2010 and totaled nearly $5 billion in fiscal year 2010, making Korea the fifth largest export market for U.S. farm products.

The U.S. share of the Korean import market has fallen from 21 to 9 percent in a little over 10 years, Vilsack said, and there is potential for farm exports to grow dramatically. The agreement, he noted, would immediately eliminate duties on the majority of U.S. farm products exported to Korea, including wheat, corn, and soybeans for crushing, and make more than 90 percent of pork exports duty-free by 2016.

Other products that would see their duties eliminated immediately are whey for feed use, hides and skins, cotton, cherries, pistachios, almonds, orange juice, grape juice, and wine.

It would still take 15 years to fully eliminate Korea’s 40 percent tariff on U.S. beef. But Vilsack noted that Korea is negotiating an agreement with Australia, a competitor for the Korean beef market, which may allow tariff cuts for Australian beef to take effect before those on U.S. beef if ratification of the U.S.-Korea agreement is delayed, he said.

Beef has been a sore point between the United States and Korea ever since the first case of mad cow disease was discovered in the United States in 2003. Korea banned U.S. beef and has been slow to reopen the market, insisting on taking meat only from younger animals. U.S. beef exports to Korea doubled last year, however.

Republican leaders have said that Obama should also send the free trade agreements the United States has negotiated with Colombia and Panama to Capitol Hill along with the Korean agreement. Vilsack said Korea should go first but that he and Obama want the other agreements to move as quickly as possible.

“We need to get these agreements done as quickly as possible. We do not have the luxury of waiting until the stars are aligned perfectly. Our competitors want us to delay so that they can establish their own presence in the market,” he concluded.