Next year marks 20 years since Korea signed a free trade agreement (FTA) with the United States, the world’s leading economy, in 2007. Even after the launch of the Trump administration, which has threatened the existing trade order, the FTA has helped make Korean exports more competitive than those of rival countries. The FTA has also been a strong backer as Korean fermented foods such as kimchi, gochujang, and makgeolli spread worldwide amid a global Korean Wave and rising demand for healthy foods. We look at the popularity of fermented foods in the United States, one of Korea’s major export destinations, and examine how the FTA has helped expand exports. We also propose policy tasks to ensure that fermented foods become steady sellers, not fleeting fads. [Editor’s note]
Volunteers from the Ministry of Planning and Budget Lottery Commission and Dong Hang Lottery make kimchi to deliver to low-income and vulnerable seniors during a kimchi-making and sharing service event at the Geumcheon Hoam Senior Welfare Center in Geumcheon-gu, Seoul, on the 27th. /Courtesy of News1
As President Donald Trump imposed sweeping tariffs on major trading partners after taking office last year, the free trade agreement (FTA) between Korea and the United States has served as a kind of “tariff shield” for Korean exports. While duty-free treatment was lost, the effect of the FTA means Korean goods face lower tariff rates than China, a powerful export competitor.
With the Korea-U.S. FTA that took effect in 2012, the 11.2% tariff on kimchi was eliminated immediately. However, after President Trump took office in April last year, a blanket 10% tariff was imposed on trading partners worldwide, and starting in July of the same year a 15% reciprocal tariff was applied. After the U.S. Supreme Court ruled the reciprocal tariff invalid, the Trump administration imposed a 12.5% forced-labor tariff under Section 301 of the Trade Act.
By contrast, the tariff rate on Chinese kimchi, from a country without a trade agreement with the United States, rose to 36.2% from 9.6% before the Trump administration. The base tariff rate of 11.2% was stacked with the 25% tariff the United States imposed on China under Section 301 of the Trade Act. As the kimchi tariff gap between Korea and China widened compared with before the Trump administration, analysts say the price competitiveness of Korean kimchi improved in the U.S. local market.
Kimchi exports are expanding not only to the United States but also to other FTA partners such as Canada, the Netherlands, and Australia. In the past, more than 70% of exports went to Japan, which does not have an FTA, but that share has now fallen to 30%–40%. FTA partner countries in the Americas and Europe are filling the gap. Yeongilman Kimchi Research Institute, a kimchi maker in Pohang, North Gyeongsang, signed its first contract early this year to export 100 tons of kimchi to Canada. Saebyeok Farm, an agricultural corporation in Jangseong, South Jeolla, also secured its first shipment of four kimchi products to Australia worth $15,000.
◇ Agriculture ministry supports with “export vouchers” for product development, logistics, and market entry
Minister Song Mi-ryung of the Ministry of Agriculture, Food and Rural Affairs inspects winter napa cabbage shipment trends during a visit to kimchi processor Domisol Foods in Paju, Gyeonggi Province, on the afternoon of January 12, 2025. /Courtesy of News1.
The government is pursuing a range of export support policies to maximize the impact of FTAs. The Ministry of Agriculture, Food and Rural Affairs’ “agri-food export growth package” is a prime example. Under this program, the Korea Agro-Fisheries & Food Trade Corporation (aT) provides export vouchers to cover expenses for technology development, logistics, and market development for medium-sized and small agri-food exporters. Last year, 316 corporations received 18.023 billion won in support. Their exports totaled $1.90644 billion, up 2.3% from a year earlier.
In addition, to help medium-sized and small exporters benefit from FTA tariff preferences, the government matches them with professional customs brokers to handle issuance of certificates and declarations of origin. Through aT’s overseas offices, it also supports promotions linked with major retail chains in countries where FTA tariff cuts have a strong effect, and covers expenses such as participating in overseas trade shows.
The government is also drawing up a five-year “comprehensive plan to promote the kimchi industry.” In the plan established in 2023 through 2027, it said it would increase “excellent starter cultures” to keep kimchi’s taste and quality consistent from the current 30–40 types to 60 next year. It also plans to raise the distribution rate of starter cultures among small exporters from the 10% range to 90%. In addition, it is developing “supercooling temperature-control technology,” which delays fermentation and minimizes quality changes by keeping temperatures below the onset point without freezing kimchi.
◇ More consumers are seeking Korean products… “made in Korea” branding needed
The kimchi section at H Mart, an Asian grocery store in Los Angeles, United States. /Courtesy of Lee Hyun-seung in LA.
Medium-sized and small kimchi exporters said that because Chinese kimchi still poses a high barrier in overseas markets, the government should lead “made in Korea” kimchi branding. According to the trade statistics service GTA of Standard & Poor’s (S&P), China is the country that exports the most kimchi to the United States worldwide. Based on the latest available data for 2024, China’s annual kimchi exports to the United States are about $170 million (227 billion won), or 20%–30% of the total. The share for Korean kimchi is only around 2%–3%. Even considering tariffs, Chinese kimchi remains cheaper, they said.
Bae Cheol-min, managing director of Yesodam, a domestic agricultural corporation that exports more than 20 kinds of kimchi to 11 countries including those in the Americas, said, “Thanks to the Korean Wave, overseas consumers’ interest in various kimchi has never been higher.” Bae added, “However, awareness of ‘made in Korea’ kimchi is not high, so kimchi made by Chinese or African- and European-affiliated corporations is often distributed, but when you actually taste it, it is completely different from the taste of Korea’s kimchi.” Bae continued, “Policy efforts are needed to prevent first-time foreign tasters from forming the perception that kimchi made outside Korea is the real thing.”
Production support: Ministry of Agriculture, Food and Rural Affairs · Korea Rural Economic Institute (KREI) 2026 FTA Implementation Support Center education and publicity project