If this is an open market, U.S. Rep. Jerry Moran doesn’t want to see a closed one.
Officially, South Korea has been open to American beef since September. But so far, every U.S. shipment has been rejected. All together, the Koreans have turned down 22 tons of meat from the United States because it contained bone chips the size of a pea.
So now Moran’s ready to do a little rejecting of his own. The Kansas Republican is asking the U.S. government to walk away from free-trade talks with South Korea until the Koreans moderate their stance on beef imports.
“Doing nothing is an inadequate response,” Moran said. “There ought to be an economic consequence to South Korea taking the stance it has.”
Only about 10 percent of American beef is shipped overseas, but it tends to be some of the best cuts. At one time, South Korea was the second-biggest foreign customer for U.S. beef, behind only Japan. In 2003, that meant $814 million worth of beef sales.
And then everything went over the cliff. In 2003, the United States reported its first case of mad cow disease, found in a cow of Canadian origin. Both Japan and South Korea slammed the door shut and the beef industry took a hit. The Japanese ban alone cost the United States more than $3 billion in lost sales before the barriers were lifted this year.
But it’s not the same market as before. Japan will only accept U.S. beef from cattle that are 20 months old or younger. Most countries accept 30 months. Meanwhile, South Korea insists on completely boneless beef, a standard Moran said no meatpacker could hope to reach.
“It seems to me that South Korea’s announcement that they were opening their market to us created false assumptions,” Moran said. “As their criteria become clear, it’s very obvious that they were open in a press-release sense only.”
Trade talks with South Korea have been going on since June, with the next round scheduled for Jan. 15. The talks must conclude by March so that Congress can have a 90-day review period before Pres. George W. Bush loses his “fast-track” authority.
Republican Sen. Pat Roberts of Kansas has also suggested using the trade talks as a hammer to get South Korea’s attention. For the United States to keep negotiating free trade in the face of an “uneven and dishonest trading environment,” would send the wrong message, he said in a letter to Secretary of Agriculture Mike Johanns and U.S. trade representative Susan Schwab last week.
“We cannot reward bad behavior and must stand behind farmers and ranchers in the United States who produce the safest, highest quality product the world has to offer,” Roberts said in the letter. “We have unfortunately set poor precedent in our dealings with the Japanese and cannot allow our position of advocating fair, science-based trade to erode further via a free trade agreement with South Korea under the current circumstances.”
Moran has also asked the incoming chair of the House Agriculture Committee, Minnesota Democrat Collin Peterson, to hold hearings where Johanns and Schwab can explain the circumstances and what they think it would take to shift the Korean position.
Right now, Moran said, walking away from the talks has little downside for domestic ranchers and meatpackers. After all, he noted, they’re already closed out of an “open” market and the situation isn’t looking any better.
“I don’t think our beef producers have anything to lose,” Moran said.