U.S. welcomes Korean decision on beef imports

WASHINGTON (Reuters) - The Bush administration on Friday welcomed South Korea's decision to relax import rules for U.S. beef, removing a stubborn obstacle to consideration of a major bilateral trade deal.

"I am very pleased that safe, affordable, high-quality American beef will soon be back on the Korean table," U.S. Trade Representative Susan Schwab said in a statement.

The deal came just a few hours before South Korean President Lee Myung-bak arrived at the Camp David presidential retreat for talks on trade and security over the next day.

With the export beef deal in hand, Bush planned to serve Lee roasted beef tenderloin for dinner.

The long-running trade spat has not only been a frustration to the U.S. beef industry but has blocked serious debate about the lucrative trade deal, which was clinched over a year ago and must still be approved by Congress.

Early Friday morning, Seoul officially announced it would gradually open its market to U.S. beef imports as Washington intensifies safety standards.

Eventually, if all goes well, a full range of U.S. beef boneless and bone-in, from animals of any age, would be shipped to a market estimated to be worth up to $1 billion a year.

The announcement came after days of negotiations in Seoul aimed at resuming regular U.S. beef shipments for the first time since mad cow disease was discovered here in 2003.

"This agreement with Korea has been a long time coming," said Bob Stallman, president of the American Farm Bureau Federation, the largest U.S. farm group.

The South Korean market was once a top export market for American cattlemen, with shipments around $800 million before the mad cow catastrophe derailed U.S. sales abroad.

The South Korean government won't accept all U.S. beef products right away, but instead will begin with beef from animals under 30 months of age.

Later, once an enhanced feed ban rule is published, all shipments will be accepted, Schwab's office said.

There are a host of other stipulations, including a requirement that beef from Canadian feeder cattle be allowed only if they have been fed in the United States for 100 days.

South Korea had agreed in 2006 to accept younger, boneless beef, but trade never resumed in earnest and was choked off entirely last fall after several problematic shipments.

Some promise continued skepticism, including Senate Finance Committee chairman Max Baucus, who even on Friday said he would block the agreement's advance in Congress until a full range of U.S. beef showed up in Korean stores .

"I believe this deal can get us there if the Korean government follows through," he said.

With trade underway to South Korea, the focus turns now toward several other Asian markets that have either restricted or have banned U.S. exports entirely.

"I hope South Korea's leadership on this issue will convince leaders in Japan, Taiwan, China and other markets still maintaining unscientific, unreasonable restrictions ... to take a hard look at this issue," Schwab said.

For the Bush administration, the real work must also begin on garnering support for the South Korean trade deal, sure to face resistance over its package on auto trade.

"If this deal holds ..., I believe it will allow the Congress to begin the process to approve the Korea-United States Free Trade Agreement before the end of the year," said Sen. Saxby Chambliss, a Georgia Republican.

But passing any trade deal would be a feat in an election year, and in a Congress increasingly skeptical of trade.

The House of Representatives recently invoked the ire of the entire Bush cabinet when it voted to indefinitely delay voting on a trade deal with Colombia, which many lawmakers oppose primarily because of union-related violence there.

(Additional reporting by Patrick Rucker; Editing by Marguerita Choy)