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U.S. Producers Eye New Markets in South Korea

But rice farmers are feeling left out, and beef producers are still waiting for market access.

Representatives from the U.S. and South Korean administrations reached a free-trade agreement Monday, tackling - or in some cases avoiding - contentious agricultural issues. U.S. agricultural industry groups have responded according to how the deal relates to their product.

Rice producers are voicing some of the loudest complaints, as the agreement does not include either country's rice markets. Seoul insisted that South Korea's sensitive and heavily protected rice industry was not to be included in a trade deal. U.S. rice farmers feel they could have benefited from the new export market.

"While we appreciate and applaud the diligent efforts by USTR Susan Schwab, Ambassador Richard Crowder, and Agriculture Secretary Johanns on behalf of U.S. rice in this agreement, the fact is that U.S. rice farmers and marketers have been excluded from one of the most significant bilateral trade agreements in over a decade," USA Rice Federation Chairman Al Montna said in statement released by the group and the US Rice Producers Association.

Meanwhile, the American Soybean Association praised the deal for creating new export opportunities for U.S. soybean, meat and poultry products. The deal grants access for U.S. food-grade soybeans without the interference of the Korean State Trading Enterprise, with tariffs on crude and refined soybean oil to be phased out over the next decade.

"U.S. soybean growers will also benefit because this agreement is expected to generate millions of dollars of new meat and poultry exports," says ASA President Rick Ostlie, voicing hopes that beef shipments to South Korea will resume and adding a word on the behalf of U.S. rice: "From a U.S. grower perspective, perhaps the only disappointment is that the highly sensitive rice trade was excluded from the agreement. On balance, however, the agreement is very positive because it will further open South Korea's market to U.S. exports of soy and other products."

The National Cattlemen's Beef Association says it is withholding judgment of the deal until it becomes clear whether or not South Korea will begin accepting shipments of U.S. beef.

That possibility may become a reality by year's end, according to an anonymous official with Korea's Agriculture Ministry in Yonhap News. That source says that if negotiations occur in June - the month after the World Organization for Animal Health is expected to re-label the U.S. a "controlled-risk" region for bovine spongiform encephalopathy - it could lead to the reopening of the beef market within three to four months. South Korean beef prices could drop 20% if Seoul reopens its market to U.S. beef.

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