Washington - U.S. cattle producers are calling on the Clinton administration to negotiate a new beef trade pact with South Korea, which is expected to fall short of its minimum import commitment this year.
“Korea is in breach of its obligations,” the National Cattlemen's Beef Association said in a letter urging U.S. Agriculture Secretary Dan Glickman and U.S. Trade Charlene Barshefsky to initiate talks on a new agreement.
In the 1995 Uruguay Round, South Korea received an exemption that allowed it to delaly liberalization of its beef import market until 2001. In exchange, South Korea agreed to import certain quantities of beef each year.
South Korea fell about 5,000 tonnes short of the 1997 import quota of 167,000 tonnes and is expected to fall even further below the 1998 import quota of 187,000 tonnes, said Chuck Lambert, trade specialist for the NCBA.
The goal of a new beef trade agreement would to speed up the liberalization of South Korea's beef market by putting its high import tariffs on a fast, downward track, Lambert said.
Currently, South Korea's “tariffs on beef are over 50%,” he said.
Lower tariffs would make U.S. beef more attractive to South Korean consumers, who are eating less beef as a result of the country's severe financial difficulties.
The combination of South Korea's currency devaluation and large unemployment has “hammered demand,” Lambert said.
In 1997, South Korea bought close to $300 million worth of U.S. beef. But 1998 sales could fall well short of that level -- even with USDA export credit assistance , Lambert said.
The United States has sold $146 million of beef to South Korea in 1998 under the GSM-102 export credit program.
But USDA has said it will not extend more export credits for beef or any other commodity to South Korea until at least fiscal 1999, which begins Oct 1.
Meat Industry Insights News Service
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