Korea-U.S. pact marks first anniversary March 15th
The Korea-United States Free Trade Agreement (KORUS FTA) will celebrate its first anniversary on March 15th. The agreement with South Korea is the United States’ most commercially significant agreement in almost 20 years. Thanks in part to the KORUS FTA, three Idaho companies – Glanbia Foods, Northwest River Supplies, and PakSense – have dramatically increased sales.
“With the ease of exporting to South Korea, we’ve seen steady growth over the last couple years. Korea represents a huge opportunity for us as we continue exploring new market opportunities, grow our dealer base and increase our sales in the region,” said David Blue, director of sales and marketing at Northwest River Supplies.
Northwest River Supplies (NRS) specializes in products for the niche market of whitewater rafting and kayaking. Today, the company manufactures thousands of products from oars to lifejackets for paddling enthusiasts all over the world. NRS exports to approximately 60 countries and began trading with Korea about six years ago by importing inflatable watercraft for use in river running applications. Nearly a year later, NRS began exporting to Korea as kayaking and whitewater rafting started to gain in popularity. NRS benefits from reduced tariffs and simplified trading for both its exports and imports as a two-way trader with Korea.
Glanbia Foods also is realizing tremendous success doing business in Korea. After exporting whey proteins and lactose to Asian markets since the early 1990s, Glanbia Foods expanded its exports to include cheese in 2007. That year, Korea imported nearly 20 million pounds of cheese from the United States. Cheeses such as cheddar had tariffs higher than 30 percent before the KORUS FTA. Those tariffs now are being incrementally reduced until they are eliminated completely in 2021.
Dave Snyder, vice president of global business development at Glanbia, said, “Korea – even before the FTA was implemented – was identified as a key, strategic market, and is one of the cornerstones for Glanbia’s growing export business in Asia.” PakSense, a manufacturer of intelligent packing labels that monitor perishable goods during distribution and storage, began exporting to Korea in 2009. PakSense labels, which are about the size of a sugar packet, monitor and store data on the condition and temperature of packaged goods. They can even issue a warning if the temperature of a package gets too hot or cold. The labels are used to monitor seafood, meat, juice, chemicals, pharmaceuticals and other products.
The KORUS FTA allowed PakSense to grow its business on multiple fronts. First, tariff reductions make it cheaper for Korean customers to purchase PakSense labels and protect their perishables. Second, as the KORUS FTA expands trade volume between the United States and Korea, there are more potential customers who can use PakSense’s labels.
All three companies have worked with either the Idaho Department of Commerce or Department of Agriculture for assistance in developing their international relationships. To encourage Idaho businesses to explore foreign export opportunities, Governor C.L. “Butch” Otter will lead a trade mission to Korea and two other countries, April 19-27. Trade mission stops include Seoul, Korea; Taipei, Taiwan; and Ho Chi Minh City, Vietnam.
For more information about exporting internationally and the Governor’s upcoming trade mission, visit: https://commerce.idaho.gov/international
For more information about the Korea-U.S. Free Trade Agreement, visit the Office of the U.S. Trade Representative website here.