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U.S., Korea Streamline Trade in Organic Products

Thursday, July 03, 2014
Sandler, Travis & Rosenberg Trade Report

An arrangement under which organic processed products certified in the U.S. or Korea may be labeled as organic in either country took effect July 1, according to the Office of the U.S. Trade Representative. The Organic Trade Association states that this arrangement will reopen a “lucrative” market that was “effectively closed to the U.S.” at the end of 2013 due to a change in Korea's organic certification requirements. The new arrangement is the fourth for the U.S., following similar deals with the European Union, Canada and Japan, but the first for Korea.

The arrangement covers products that (a) are certified to the U.S. Department of Agriculture or Korean organic regulations, (b) are “processed products” as defined by the Korean Food Code (e.g., condiments, cereal, baby food, frozen meals, milk and alcoholic beverages), (c) contain at least 95 percent organic ingredients, and (d) have their final processing (as defined in the Korean Food Code) occur in the U.S. or Korea. It does not apply to products containing (a) U.S apples or pears produced with the use of antibiotics or (b) Korean livestock products produced with the use of antibiotics.

Products exported from the U.S. to Korea under this arrangement must be accompanied by a NAQS import certificate of organic processed foods, must be labeled according to the Korean Ministry of Agriculture, Food and Rural Affairs’ organic labeling requirements, and may display the Korean organic food label and/or the USDA organic seal. Products exported from Korea to the U.S. under this arrangement must be accompanied by a National Organic Program import certificate issued by a MAFRA-accredited certification body, must be labeled according to USDA organic labeling requirements, and may display the USDA organic seal and/or the Korean organic food label.

A USTR press release states that without this arrangement in place, organic farmers and businesses wanting to sell organic processed products in the U.S. or Korea would have to obtain separate certifications to meet each country's organic standards, which typically has meant two sets of fees, inspections and paperwork as well as delays for farmers and businesses trying to export. The OTA cited estimates that under this arrangement U.S. exports of organic processed foods and beverages to Korea, which hit $35 million in 2013, will more than double over the next five years.

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