Agricultural Equipment Sector

An Expert's View about Machinery and Robotics in South Korea

Posted on: 11 Jun 2012

Korea is the 17th largest market for U.S. agriculture equipment exports.

U.S. Department of Commerce International Trade Administration The U.S.-Korea Trade Agreement: Opportunities for the U.S. Agricultural Equipment Sector The U.S.-Korea Trade Agreement would provide signicant commercial opportunities for U.S. exporters: • Korea is the 17th largest market for U.S. agriculture equipment exports; failure to pass the U.S.-Korea Trade Agreement could enable exporters from the EU and other countries to gain key advantages over U.S. exporters to Korea. • All U.S. agricultural equipment exports to Korea would receive duty-free treatment immediately upon implemen- tation of the U.S.-Korea Trade Agreement; Korean agricultural equipment taris currently average 0.4 percent, ranging up to 8 percent. Agricultural Equipment Sector Overview U.S. Agricultural Equipment Exports to • The agricultural equipment sector accounted for $24 million in Korea Averaged $24 Million 1 U.S. exports to Korea over 2008-10 (average). • Top agriculture equipment exports to Korea include tractors, $50 rice-planting machines, harvesters, lawn mowers, and straw $40 balers, which are larger than similar equipment manufactured by Korean companies. $30 • In 2009, U.S. production of agricultural equipment products $20 2 was over $22 billion. $10 • The U.S. agricultural equipment sector employed over 56,000 3 $0 workers in the United States in 2009. 2008 2009 2010 Ko rea's Imports of Ag ricultural Improved Market Access for U.S. Agricultural Equipment ** Equipment Exporters to Korea • Korean agricultural equipment taris average 0.4 percent, rang- $200 ing from zero to 8 percent. $150 4 • 100 percent of U.S. agricultural equipment exports to Korea $100 would receive duty-free treatment immediately upon imple- mentation of the trade agreement. $50 $0 JapanEUnited China States ** 2007-09 Average (latest available data) 1 Global Trade Atlas. Calculations by the U.S. Department of Commerce based on import data as reported by Korea. The denition for agricultural equipment in this report, unless otherwise cited, is based on Harmonized System (HS) Headings 8432, 8433, 8434, and 8701. 2 U.S. Department of Commerce, U.S. Census Bureau, NAICS 333111. Shipments used as a best available proxy for production. 3 U.S. Department of Labor, Bureau of Labor Statistics, NAICS 333111 (non-seasonally adjusted data). 4 Data based on three-year average for 2008-2010. April 2011 Additional information available at: in Millions USD In Millions USD Foreign Competition in the Korean Market • Korea signed a trade agreement with the EU in 2009, which is scheduled to enter into force in July 2011. It also recently signed an FTA with Peru, which is also scheduled to enter into force this year. Korea presently has FTAs in force with ASEAN, Chile, India, Singapore, and EFTA. In addition, Korea is negotiating new agreements with Australia, Canada, Colombia, New Zealand, and Turkey; is considering launching FTA negotiations with China; and is exploring re-launching its stalled negotiations with Japan. • EU agricultural equipment exporters will immediately enjoy an average tari of 0.3 percent upon entry into force of the EU-Ko- rea FTA, while U.S. exporters will face an average most favored nation (MFN) tari of 0.4 percent until entry into force of the 5 U.S.-Korea Trade Agreement. • Top suppliers to Korea of agriculture equipment include: Japan, the EU, United States, and China. Key States Exporting to Korea • Top U.S. states exporting agricultural equipment to Korea include: South Carolina, Wisconsin, Iowa, North Carolina, Colorado, Oregon, Minnesota, Illinois, California, and Georgia. Other Key U.S.-Korea Trade Agreement Commitments for the Agricultural Equipment Sector • Technical Barriers to Trade: The U.S.-Korea Trade Agreement strengthens disciplines to promote transparency in the way governments develop and apply technical regulations and related conformity assessment procedures (e.g., testing and certication). For example, Korea agreed to provide national treatment, or the same treatment applied to Koreans, to U.S. persons for participation in the development of standards, technical regulations, and conformity assessment procedures; and to accreditation, licensing or approval of U.S. conformity assessment bodies. • Transparency: The U.S.-Korea Trade Agreement includes strong transparency obligations, with commitments that the national gov- ernments of both parties would to the extent possible publish proposed regulations in advance, allow a reasonable opportunity to comment, address signicant substantive comments received, publish nal regulations in an ocial journal of national circulation, and provide sucient time between publication of the nal regulation and implementa- tion of the regulation to allow stakeholders to adjust. The U.S.-Korea Trade Agreement also includes strong anticorrup- tion provisions obligating the Parties to adopt and maintain anti-bribery measures in international trade and invest- ment. Parties further commit to maintain appropriate penalties and procedures to enforce such anticorruption rules, and to protect persons who report any of the criminal acts. • Intellectual Property Rights: The U.S.-Korea Trade Agreement provides for robust protection and enforcement of intellectual property rights, includ- ing the extension of patent terms to compensate for unreasonable delays in granting an original patent. The trade agreement also has specic provisions for the protection of copyrighted works including measures designed to pre- vent piracy and unauthorized distribution over the Internet. Provisions to combat trademark counterfeiting include customs enforcement against goods-in-transit and streamlined customs procedures to increase eciency of enforce- ment. • Remanufactured Goods: Korea would eliminate its prohibition on the importation of remanufactured goods as dened in the initial provisions and denitions chapter, including remanufactured agricultural equipment, upon entry into force of the agreement. 5 U.S. Department of Commerce Calculations based on EU-Korea FTA and U.S.-Korea Trade Agreement commitments. April 2011 Additional information available at: U.S. Department of Commerce International Trade Administration The International Trade Administration - Your Global Business Partner The International Trade Administration (ITA) – a division of the U.S. Department of Commerce – strengthens the competitiveness of U.S. industry, promotes trade and investment, and ensures fair trade through the rigorous enforcement of our trade laws and agreements. ITA also utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. For more information on exporting to Korea, please contact: • The ITA office of the U.S. Embassy in Korea at or 82-2-397-4535, or by visiting our website • The ITA trade specialist in the U.S. nearest you by visiting For more information on the U.S.- Korea Trade Agreement, please visit and For more information on industry-specific issues, please visit
Posted: 11 June 2012

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