U.S. Pork Benefits From Korea Trade Deal, Says ITC

WASHINGTON, D.C. - The price competitiveness of U.S. pork will be enhanced through the increased market access the United States will gain under the U.S.-Republic of Korea Free Trade Agreement, according to a report released yesterday by the U.S. International Trade Commission (ITC).
calendar icon 24 September 2007
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The National Pork Producers Council welcomed completion of the ITC’s economic analysis, which estimates the Korea trade deal will increase the U.S. gross domestic product by up to $11 billion. NPPC is a strong supporter of the trade agreement.

“The completion of the ITC report is a positive step forward in the process of implementing the trade agreement with South Korea,” said NPPC President Jill Appell, a pork producer from Altona, Ill. “This FTA offers U.S. pork producers a significant opportunity to increase pork exports to an already lucrative market for U.S. pork.”

South Korea already is the fourth largest destination for pork from the United States, which shipped 109,198 metric tons valued at $232 million to the Asian nation in 2006. Those amounts are expected to soar under the free trade agreement. For pork producers, when the pact is fully implemented it will cause live U.S. hog prices to be $10 higher than would otherwise have been the case, according to Iowa State University economist Dermot Hayes.

Under the rules of Trade Promotion Authority, the ITC must complete an economy wide study of any free trade agreement. The report on the Korea FTA covers a broad range of sectors, including agriculture, services and manufactured goods. The ITC noted that the increased market access would likely enhance the price competitiveness of U.S. pork in the Korean market, “especially with respect to pork from Chile.” That country implemented an FTA with Korea in 2004 that gives it duty-free access to the Korean market beginning in 2014. Chile is a major competitor with the United States in the Korean market for pork.

The trade deal, on which NPPC worked to get favorable treatment for U.S. pork and pork products, is pending a vote by Congress. The National Assembly of the Republic of Korea also must approve the pact, which was formally completed April 1.

“It is now time for Congress to act,” NPPC’s Appell said, “It should ratify the U.S.-S. Korea Free Trade Agreement expeditiously because it will benefit U.S. pork producers and the overall U.S. economy.”

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