South Korea continues to pay the price of a livestock herd forced to downsize due to foot-and-mouth disease issues. The reduced meat supply has pushed meat prices, especially pork to extreme highs. This has prompted inflation that government officials have tried to temper throughout the spring and summer, having eliminated tariffs and quotes on imported meat.
Now, the country’s leaders are continuing that effort as the finance ministry announced there will be zero tariffs on all chilled pork imports through Sept. 30 that are destined for food processing.
Prior to this announcement, there was a 22.5 percent tariff imposed on any imported pork entering the country that exceeded the volume quota.
Pork is the No. 1 consumed meat in the country. In 2010, South Korea imported 4,655 tons of chilled pork used in further processing. Earlier this year, government officials committed to allowing 260,000 tons of frozen and chilled pork to be imported tariff-free. Now, the options are unlimited at least through September.
The zero-tariff is expected to be activated later this week, once South Korea’s president approves the measure, according to a finance ministry spokesperson.
It’s estimated that FMD forced South Korea to cut its swine herd was cut by one-third, and there remains questions as to the future rebuilding prospects given high input prices. The government estimates the FMD outbreak cost the country nearly 3 trillion won ($2.86 billion U.S.).
South Korea's consumer price index rose 4.7 percent in July from a year earlier, remaining stubbornly above 4 percent, the top of the central bank's target range, Reuters reports. Fresh food prices rose 9 percent from a year ago, up from 4.7 percent in June.
Beyond meat, the government will expand the zero-tariffs to include imported bananas, pineapples, cabbages and radishes, the ministry noted. .
While this move advances the potential for U.S. pork shipments in to the Asian country, Congress’ continued delay in approving the South Korea/U.S. Free-trade Agreement limits U.S. pork producers’ long-term growth prospects. Meanwhile Europe and Canada are expanding their pork export market share into this consumer-rich country. South Korea has the world’s fourth-largest economy and could become U.S. pork’s No. 1 customer if or when trade is fully open.