If there's going to be a U.S./Korean free trade agreement (FTA), it must be submitted to Congress by March 30. That means that within the next 30 days or so, the industry will know whether it will reach the promised land or be sold down the river once again.
There are many contentious issues still on the table -- automobiles, pharmaceuticals, media and, of course, the beef trade. Last week, the Koreans reaffirmed their stance that only boneless U.S. product will be allowed, so there's been seemingly little palpable progress.
U.S. negotiators have said for quite some time that without full access to the South Korean market for our beef, an FTA is dead. As a consequence, Korea has kept that bargaining chip until the last hour when all of these contentious issues must be agreed upon. Insiders tell me the Koreans will capitulate on beef; they're just ensuring they get a concession in exchange.
There's a lot at stake for both sides, and the desire to get a deal done will lead to a lot of horse trading as the final hours draw closer. Despite admonishments to Korea from cow-state Senators that failure to gain beef access is a deal breaker, there were disconcerting overtures from the U.S. Trade Representative Office this week that seemed to suggest that might not be the case if other key issues can be resolved.
Each side is posturing, and it's good strategy on the U.S. side to downplay the importance of this important Korean stipulation. But the bottom line is that the U.S. beef industry will have a very clear idea of where it stands relative to Korea in the next 45 days.
There's the possibility that other issues will make the FTA unworkable, and the U.S. industry will lose valuable leverage if the FTA fails to come to fruition. There's also the risk that U.S. and Korean negotiators will hang cattlemen out to dry if other areas can be worked out.
If the U.S. holds to its stated policy that an FTA is contingent upon a science-based beef trade, then the odds are good we'll see the market reopened, if agreement can be reached in other areas. It would probably be worth a phone call to your U.S. Senators to let them know how important it is that Korea be held to the standard of being a fair and honest trading partner, before giving them the opportunities that will come with an FTA.
-- Troy Marshall