
South Korea has made a big splash in the news lately — most notably from the Winter Olympics in Pyeongchang. However, according to a report released by Nebraska Farm Bureau on Friday, South Korea plays a big role in Nebraska ag exports.
The report gives a dollar-and-cent breakdown of the value of the U.S.-Korea Trade Agreement at the county and farm level, and the implications to Nebraska’s broader economy.
It also highlights the potential risk for Nebraska should the Trump administration renegotiate KORUS in a way that would negatively impact agriculture.
The KORUS free-trade agreement first went into effect in 2012, and Jay Rempe, senior economist at Nebraska Farm Bureau, notes Nebraska has seen a rapid growth in trade of ag products to South Korea.
“If you look at the three years prior to being enacted, the average sale of agricultural goods to South Korea was $210 million from Nebraska. In the last three years, the average has been $321 million. That’s a 52% increase from before and after. So, we are seeing a benefit,” Rempe said. “In 2016 exports to South Korea from Nebraska equaled $340 million. So, South Korea has grown to be our fifth-largest customer for Nebraska ag products. It is growing in importance, and no doubt due in part to the free-trade agreement.”
Beef and pork are easily the two largest export products from Nebraska to South Korea. In 2016, beef exports accounted for $221 million, and pork exports totaled $39 million.
Rempe notes the tariffs on both beef and pork have been reduced since the agreement, and will continue to be reduced. Before the agreement, the tariff on beef going into South Korea was 40%. That number has been reduced to almost 22%, and in 2022, is set to drop to under 11%. Meanwhile, the tariff on pork going into South Korea was reduced from 22.5% to its current 6.75%. By 2022, the tariff is going to be phased out completely.
By taking the export value of that product in Nebraska in 2016 and dividing it by the inventory of cattle and pork in the state in 2016, the report showed exports of beef from Nebraska to South Korea are worth $34.35 per head, and exports of pork from Nebraska to South Korea are worth $11.52.
“To put that in perspective, especially on the beef side, where we did a NAFTA study earlier, the beef side that showed about $38 per head,” said Rempe said. “Beef sales to South Korea are almost nearly as important to producers out there as the sales to our bordering neighbors of Canada and Mexico. On the pork side, it’s about half of what it was for NAFTA, but it’s still pretty impressive.”
The report also breaks down the value of KORUS at the county and farm level in Nebraska, using the value of production in that county relative to the state as a total.
Cuming County came out on top with about $12.5 million, followed by Custer County at $12.4 million and Holt County at $11.5 million. Other counties above $9 million included Platte, Lincoln, Dawson, and Cherry counties.
COUNTY-LEVEL WINNERS: A the county-level, Cuming County came out on top with about $12.5 million in value from KORUS in 2016, followed by Custer County at $12.4 million and Holt County at $11.5 million. Other counties above $9 million included Platte, Lincoln, Dawson, and Cherry counties.

“Obviously, these are livestock-heavy counties in terms of their beef production and pork production,” Rempe said. “In total, there are about 13 counties that had greater than $5 million of export value that South Korea provided to those counties.”
In terms of the export value to the farmer or rancher in each county, Wheeler County saw the most benefit at about $20,000 per farm, followed by Cherry County at $16,000 per farm, and Phelps County at about $14,500 per farm, largely due to the beef production in those counties.
COUNTY-LEVEL WINNERS: A the county-level, Cuming County came out on top with about $12.5 million in value from KORUS in 2016, followed by Custer County at $12.4 million and Holt County at $11.5 million. Other counties above $9 million included Platte, Lincoln, Dawson, and Cherry counties.

Rempe said he hopes the report shows the importance of trade with South Korea for Nebraska ag products — and what’s at stake in current debates surrounding trade.
Renegotiations on KORUS only recently began in early January, and the Trump administration has highlighted the U.S. trade deficit with South Korea as a primary concern. However, Rempe noted that agriculture has a trade surplus of over $6 billion with South Korea.
And, he said, it isn’t likely a renegotiation could improve the trade deficit with South Korea, due to the underlying economics at play around the world.
“The dollar is relatively higher-valued, that means the goods they try to sell to us are less expensive. We’re a consumer-driven economy in the United States, and we have a tendency to like to spend our money. That naturally leads to a trade deficit. While trade agreements can maybe influence that a little bit at the margin, it would be really hard for a trade agreement to erase that deficit completely, because of the underlying economics that are happening.”
“Anytime you reopen negotiations like that on a trade agreement, just like in NAFTA, there’s some risk and there’s something at stake there,” Rempe said. “We’re hoping with this [report] to show what’s at stake for Nebraska.”
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