NCBA: What Does the South Korea Trade Deal Mean for US Beef

US - With an exciting year for beef exports in 2011, Dan Halstrom, Vice President of the US Meat and Export Federation (USMEF) speaks with Charlotte Johnston, TheCattleSite editor to discuss the South Korea free trade agreement.
calendar icon 2 February 2012
clock icon 2 minute read

Last year the US announced three new free trade deals (FTAs) with Columbia, Panama and most importantly, South Korea.

In 2011, total US beef exports boomed, breaking post 2003 records.

2011 exports increased by 20 per cent in volume to 1.78 million tonnes between January to November 2011, with a value of $5 billion.

Mr Halstrom expects this success to continue into 2012.

For 2012, the USMEF has estimated that beef exports will increase by five per cent in volume.

Mr Halstrom admitted that predictions are probably slightly on the conservative side. "With talks of a much smaller cow herd, prices are likely to stay high, so we expect to see a five to 10 per cent increase in the value of beef exports in 2012."

South Korea markets

"The FTA announcement is good news for the US beef industry," said Mr Halstrom. Once in place, there will be a 2.7 per cent decrease in tariffs a year.

The current duty on US beef imports into South Korea is 40 per cent. With a 2.7 per cent decrease a year, in around 15 years time import duties on US beef will be eradicated in South Korea.

As to when this will come into action, Mr Halstrom said he could not comment, but hopes that it will be soon. "The sooner the better."

"South Korea are big beef eaters, so this deal means a lot for the US beef industry," he said.

Last year beef and pork imports into South Korea increased substantially following on from a foot and mouth outbreak which caused the South Korean domestic cattle and pig herds dramatic losses.

Since 2003, when the US was hit with bovine spongiform encephalopathy (BSE), the industry has been working tirelessly to convince and prove to the Asian markets in particular, that US beef is a safe product.

Mr Halstrom said that the USMEF has worked to reassure comfort levels with South Korean consumers.

"This has been a steady improvement," said Mr Halstrom. "There is still some way to go."

In 2011, beef imports to South Korea increased by 38 per cent in volume, to 140,000 tonnes (between January and November 2011). The value increased 32 per cent, to $618 million.

Speaking about competing with Australia for South Korean markets, Mr Halstrom said that they were indeed a formidable competitor. However he believes they are targeting different markets and are marketing their products differently, with a lot of grass fed beef coming from Australia.

Charlotte Johnston, Editor

Charlotte Johnston - Editor

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