South Korea calling

South Korea calling

Tasko CEO Solomon Choi and son Richard.

Tasko CEO Solomon Choi and son Richard.


AUSTRALIAN farmers are being urged to get noticed by a fast-growing South Korean food industry keen to build more direct relationships with supply sources around the globe.


AUSTRALIAN farmers are being urged to get noticed by a fast-growing South Korean food industry keen to build more direct relationships with supply sources around the globe.

South Korea is Australia's third largest export destination, and the market is particularly strong for our beef, dairy products and wheat.

But most agribusiness imports occur via big intermediary trading houses and other middlemen.

The trading companies, combined with some hefty tariffs on farm imports, have stifled development of closer trade relationships and direct initiatives with farmers or local exporter groups, according to Korean farm trade consultant Solomon Choi.

Korean-born Mr Choi has lived in Australia for 20 years, more recently working with soybean exporters in the NSW Riverina and assisting small scale live exports of Angus cattle to breeders in South Korea.

He is keen for Australian producers and agricultural exporters to initiate more direct links with Korean food businesses and establish valuable trade contacts prior to confirmation of the long-anticipated Free Trade Agreement (FTA) between the two countries.

Although South Korea already buys about nine per cent of all Australian exports - notably minerals, farm products and education services - a FTA is expected to add about $3 million a week to the value of future sales.

Last year's US FTA with Korea cut tariffs on beef imports from 40 per cent to 36pc, with progressive tariff cuts for US exporters now occurring annually.

New Zealand is also lobbying hard to open FTA channels to South Korea, well aware of the attention given to high quality and safe food imports by the nation's 55 million consumers.

In the past six years South Korean food imports from the Asia-Pacific region have grown from 31pc of its total purchases to almost 40pc, and the country is also growing as a supplier of processed food products to other parts of Asia.

Mr Choi wants Australian farmers to recognise the opportunities opening up, particularly if farmers take the chance to work directly with Korean food ingredients businesses and tailor product options to buyers' needs.

He plans to organise and assist an Australia delegation to the annual FI Korea expo in Seoul in September where visitors and businesses from around the world flock to promote food ingredients, products, food science and manufacturing technology.

The expo also services those buying from the Korean food sector.

Chinese, US, Japanese and Turkish companies had the biggest presence among the 58 overseas businesses with stands at last year's event, but Belgian, British, French, Indian, Thai, Russian and Dutch businesses were also notable - as were government-sponsored delegations from NZ and Canada.

"Australia has not been represented at FI Korea before but businesses in Korea are starting to talk to Australian representatives about doing more trade," Mr Choi said.

"Unfortunately Australian farmers don't know much about Korea and food processors in Korea don't know a lot about Australia - they're more focused on the US, South America, even Russia."

Mr Choi wants to promote trade relationships that help importers bypass the "many middle men" and link with Australian commodity and food ingredient exporters and farmer groups.

His belief in the opportunities open to Australian exporters reflects Korea's overall interest in agriculture here, with farmland purchases by Korean companies notable in rural NSW in recent years.

Two-way trade between Australia and Korean businesses and State-owned organisations has grown 8pc annually since 2007, primarily driven by local exports.

Beef sales grew about 22pc in that period to a current value of about $1.4 billion a year, while dairy exports are worth $100m and wheat $350m.

The story South Korea calling first appeared on Farm Online.


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