The National Pork Producers Council (NPPC) expresses disappointment that the United States and South Korea failed to resolve issues on beef and automobiles that could have paved the way for completion of a free trade agreement (FTA).
The two nations had hoped to resolve their differences before the conclusion of this week’s G-20 economic meeting in Seoul, South Korea. The U.S.-South Korea FTA was signed in June 2007 and must be approved by both the U.S. Congress and the South Korean National Assembly.
“America’s pork producers and all of U.S. agriculture need the two sides to reach agreement quickly on the remaining issues so that Congress can act soon to pass the U.S.-South Korea Free Trade Agreement,” says NPPC President Sam Carney, a pork producer from Adair, IA. “This would be the biggest trade agreement ever for the U.S. pork industry. It would be good for agriculture, good for business and good for the U.S. economy. If the two sides don’t act quickly, I am very concerned that the FTA will be overtaken by the presidential election cycle.”
Iowa State University economist Dermot Hayes says by the end of the FTA’s 10-year phase-in period that total U.S. pork exports to South Korea will be almost 600,000 metric tons. A metric ton is equal to 1.1 U.S. short tons. The FTA will improve U.S. hog prices by $10/head and generate $687 million in U.S. pork exports. South Korea would absorb 5% of U.S. pork production and the FTA would create more than 9,000 new direct jobs in the U.S. pork industry.
U.S. pork exports to South Korea through August were $128 million in value, a 16% decline from 2009, according to the U.S. Meat Export Federation. By value, South Korea is the United States’ fifth-largest pork export market.
South Korea has in place or is negotiating 13 other trade agreements with 50 countries – some of whom are U.S. competitors. Because of those, if the U.S.-South Korea FTA falls through, Iowa State’s Hayes predicts the U.S. pork industry will be out of the Asian market in 10 years.
“We can’t let that happen,” responds Carney. “Our livelihoods and U.S. jobs depend on trade and on maintaining and expanding markets. The Obama administration needs to resolve the outstanding issues in the FTA, then lawmakers need to approve the deal as soon as possible.”