When the United States and South Korea reached an agreement on preferential trade terms back in 2007, neither country knew that the global economy was about to look very different from the previous few years. The world entered a prolonged recession in 2008, putting a damper on demand for everything, even food. Despite that, the Korea – U.S. Free Trade Agreement (KORUS, for short), which took effect in 2012, benefitted U.S. agricultural exports by securing a much larger share of the South Korean market for U.S. beef, pork and other agricultural exports than we had before KORUS.
U.S. pork exports to South Korea have more than doubled under KORUS. U.S. beef exports to South Korea have increased 82 percent. These gains are the result of lower tariffs, growing import quotas and science-based trade rules that open the door for more U.S. farm goods.
Today, the United States has a 27 percent share of the South Korean import market, compared to just 11 percent for the No. 2 supplier, China. As a result of our preferential trade status with South Korea, as well as the recovery in the global economy, U.S. agricultural exports to South Korea could set a new record, topping $7 billion this year. With U.S. agricultural imports from South Korea projected to be about $500 million, we are looking at an ag trade surplus of 93 percent.
South Korea is heavily dependent on agricultural imports. If the United States were to withdraw from KORUS, South Korea still would need to import the same amount of food. It would just get that food from our competitors instead of U.S. farmers and ranchers. In fact, some of our competitors, such as Australia, Canada and the European Union, have signed their own trade agreements with South Korea. They say imitation is the highest form of flattery. It certainly provides evidence that the U.S. was wise to secure the largest share of the South Korean market.
Agricultural trade under KORUS is a success story. It allows the U.S. to play to our strength—our highly productive farms and ranches. We cannot afford to walk away from that!