WASHINGTON — Pop the corks: After years of talk and delay, a historic trade pact between the United States and South Korea kicks in Thursday, and officials predict it will increase wine exports from Washington state by 40 to 50 percent in the first year alone.
The reason: The Korean cuisine relies heavily on beef, and marketers expect Koreans will want a whole lot more of the states red wines now that a 15 percent tariff is getting scrapped.
"This is a great opportunity for Washington wine. ... This will really widen the door," said Marty Clubb, co-owner and winemaker at LEcole No. 41 Winery, the third-oldest winery in the Walla Walla Valley. He said his company already has been in the Korean market for six years but will now have a big chance to expand.
"The interest in high quality wine is clearly there," Clubb said.
Officials say its just one example of what to expect as the two nations officially expand opportunities for trade.
Despite the slow economic recovery, Washington state exports hit an all-time high in 2011, rising 21 percent over the previous year to $64.6 billion. And officials say that implementing the new trade pact, first negotiated by the George W. Bush administration, will provide an immediate boon for agriculture in the nation's most trade-dependent state.
Congress signed off on the new trade deal in October, but it took months to finalize the details. Now, effective immediately, tariffs will be lifted on a wide range of products, including cherries, potatoes and apples, big crops for the Pacific Northwest.
As a result, Korean consumers _ at least in theory _ will pay lower prices for those products.
Officials say one of the biggest winners will be the states beef industry. Demand is expected to grow as a 40 percent tariff on beef is phased out over 15 years.
On Capitol Hill, members of the Washington state congressional delegation, who lobbied hard for the agreement, say its sure to fuel demand for the states products and help reduce unemployment.
A lot of people have been waiting a long time for this, Democratic Sen. Maria Cantwell said Wednesday. Were a very trade-dependent state, and so when you can get trade deals done like with South Korea and open up huge market opportunities for markets like wine and cherries and beef, it means millions of dollars and jobs.
Democratic Sen. Patty Murray said the agreement will level the playing field and give the states businesses an opportunity to expand into growing markets.
Too many of our states products have been slapped with tariffs by Korea for far too long, she said.
Until now, for example, South Korea had imposed a 24 percent tariff on sweet cherries. Without it, consumers are expected to save from 75 to 90 cents per pound at the market, officials estimate.
And the trade pact is good news for Washington state potato growers, who produced 9.8 billion pounds of potatoes in 2011 and led the nation in per-acre yield. According to industry figures, nine of every 10 potatoes are sold outside of the state, with South Korea already ranking as the fastest-growing market for U.S. frozen potatoes.