Monday September 4 Ag News

ASA Warns White House Against Misguided Withdrawal from KORUS

In response to indications that the White House is preparing a withdrawal from the free trade agreement between the United States and South Korea as early as Tuesday, the American Soybean Association issued a stern warning that withdrawal from the pact, and the larger strategy of brinkmanship with regard to trade agreements by the White House, could have disastrous consequences for the nation's soybean farmers. ASA President Ron Moore issued a statement addressing the matter directly with President Donald Trump.

"Trade helps our country, Mr. President, and withdrawal from KORUS would hurt us all. As soybean farmers, we benefit greatly from exports, which contribute a $2 billion annual surplus to our nation’s balance of trade. Trade makes our local businesses and our communities stronger. Yet whether it's South Korea, Mexico and Canada, or our neighbors on the Pacific Rim, we once again find ourselves fighting to communicate the value of trade to farmers.

“With respect to South Korea, we supply nearly half of the 1.3 million tons of soybeans that country imports, with no tariffs as a result of the KORUS agreement. Most of Korea’s soybean imports, however, come from our competitors in Brazil and Argentina. If we withdraw, reinstatement of tariffs will make it hard to maintain our market share and will further increase our competitors’ advantage. And it would be devastating for our U.S. livestock customers who export meat products to South Korea.

“The idea that we're the only game in town when it comes to selling soybeans or other agricultural products abroad is false. So is the notion that there’s always another country that will buy our commodities. Furthermore, even the threat to withdraw from this or any trade agreement is a dangerous course of action. Repeatedly walking our trade relationships to the brink, or actually breaking them, only weakens our standing abroad.

“As American soybean farmers, we demand that the U.S. remain in KORUS, and that we move forward to negotiate new trade agreements rather than retreating from existing ones. We must expand rather than abandon access to essential overseas markets for the products we produce."



Statement On Potential Withdrawal From KORUS
U.S. Grains Council (USGC):

"The Council strongly opposes withdrawal from the U.S.-Korea Free Trade Agreement (KORUS), an action that will lead to immediate and sustained losses in sales to our third largest corn customer.

"South Korea is an example of the transformational partnership available to U.S. grain farmers and their global customers through strong trade policy and overseas market development.

"The Council has worked in South Korea since 1972, offering expertise on how to use corn, distiller’s dried grains with solubles (DDGS) and, most recently, ethanol. This work has helped spur dynamic growth in the South Korean livestock and feed grains sectors and made it one of the largest and most loyal customers of U.S. grain.

"Fully 96 percent of feed producers in South Korea now use DDGS, an astounding statistic for a product that barely existed in the market 20 years ago, and one critical to U.S. producers who have suffered lost business due to China’s adverse tariffs decisions. Just last week, we hosted a team of South Korean buyers to the Midwest to see the progress of the U.S. corn crop first hand.

"KORUS has solidified and enhanced our longtime and fruitful partnership with South Korea. Unilaterally walking away from it now is a rash move that will harm relationships we have built over a period of 40 years at the expense U.S. farm country.”



U.S. Wheat Organizations Urge Administration Not to Withdraw from KORUS

U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) strongly urge the Trump Administration not to withdraw from the U.S.-Korea Free Trade Agreement (KORUS).

“We believe it would be irresponsible to unilaterally walk away from this or any other trade agreement,” said Mike Miller, USW Chairman and a wheat grower from Ritzville, Wash. “Withdrawing raises the specter of retaliation against agricultural exports and creates unnecessary uncertainty in the market. Any disruption in the relationship wheat growers have built in Korea over more than 60 years gives Australia, Canada and even Russia an opening to move in and take business away from us at a time when we are all struggling to stay profitable. KORUS, like the North American Free Trade Agreement, has been very good for American agriculture.”

"We think this trade agreement, negotiated in good faith and strongly supported in Congress, reinforces the Administration's stated goal to sell more agricultural products overseas,” said David Schemm, NAWG President and a wheat grower from Sharon Springs, Kan. “We support finding ways to improve any agreement, but let’s do that in a reasoned and respectful way, with input from all stakeholders so U.S. wheat farmers can gain greater access to world markets."

Korea was the third largest volume importer of U.S. wheat in marketing year 2016/17 (June to May).