Monday 10 September is D-Day for Korea to remove remaining barriers on the sale of imported beef through Korean butcher shops.

Australian cattle producer group Acting President, Mike Norton, said this would provide Australian product with a fair go on Korean retail outlet shelves.  "Up until now, Australian product sales have been limited to just 5,000 Korean outlets, operating as specialised imported beef stores.  The new system to be implemented today will allow product to be sold in 45,000 Korean outlets, providing a potential nine-fold increase.

"The new legislation to apply from Monday will also remove record keeping requirements that previously discriminated against imported products and allowed retailers to substitute imported beef for higher priced domestic product.

"The Australian Government and beef industry fought hard through the World Trade Organisation dispute settlement process, initiated by the United States and Australia, to remove a number of restrictions in the Korean market.  Many beneficial changes have already been implemented.

"Implementation of World Trade Organisation outcomes, coupled with Australia's Chilled Beef Standards for the Korean market implemented last October, will provide a double benefit through enhancing the image and availability of Aussie beef in our third largest foreign market.

"There is always demand for competitively priced, quality beef products.  In terms of quality, health and hygiene, Australian supplies certainly lead the world."

For further information contact:
Mike Norton, Acting President, 0417 183 439 (to Sunday evening) / Ph 08 9727 2066
Mark Ritchie, Policy Director, BH 02 6273 3688 / Mbl. 0408 748 347

KOREAN MARKET BACKGROUND

  • Following a 1988 General Agreement on Tariffs and Trade (GATT) challenge, Korea undertook limited import liberalisation, but maintained a range of restrictions on imported beef.
  • In July 2000, the WTO upheld a complaint by Australia and the United States that Korea's measures on imported beef were contrary to the WTO rules.  These measures included:
    • A requirement that imported beef be sold separately from Korean beef
    • Subsidies to Korea's beef producers
    • Minimum wholesale pricing
    • Limitations on which private sector operators can buy and sell imported beef
    • Discriminatory labeling and record keeping requirements
  • Korea has eliminated all measures bar the dual retailing system and discriminatory labeling and record keeping requirements.
  • Korean authorities have made positive moves in the lead up to 10 September deadline and have proceeded to implementation in good faith.
  • The effective tariff rate for imported beef to Korea is 41.2%.
  • In 2000, Australia exported 73,300 tonnes of beef to Korea.
  • Australian chilled beef exports for the 7 months to July were up 27% compared with the same period last year.
  • Korean beef consumption is high by Asian standards and has been rising over a number of years.
  • Approximately 45 million Korean consumers 'strongly prefer' beef.  There are no religious barriers to consumption.
  • The Government stockpile has been rundown by approximately 14,000 tonnes. The prospect of these depleted stocks has provided momentum for Korean importers.
  • Prices being accepted by Korean importers are experiencing upward trends as the market adjusts to a free trading environment that is not manipulated by Government stocks and pricing.

The Australian Chilled Beef Standards (comprising Australian Prime, Choice, Select and Premium) were launched on 30 October 2000.  The Standards were specifically developed to provide the Korean trade with a clearly defined Australian premium product range to meet their requirements of marbling, meat colour and fat.  (Refer Cattle Council Media Release 41/00 available at www.farmwide.com.au/cca