November 22, 2024
- Textiles manufactured from offshore cuprammonium rayon yarns will be duty-free for export to the U.S.
The revised rules of origin for cuprammonium rayon fabrics* under the Korea-U.S. Free Trade Agreement (Korea-U.S. FTA) entered into force in Korea on August 1, 2024.
* Cuprammonium rayon fabric: A high-end fabric with excellent texture and luster made by recycling the residual hairy fibers (cotton lint) attached to cotton seeds, used for high-end dresses, shirts, linings, etc.
The two countries agreed during the 2018 negotiations to revise the Korea-U.S. FTA to revise the rules of origin for cuprammonium rayon fabrics. These fabrics, which are in short supply domestically, can now use yarns from offshore sources after detailed discussions between the two countries finalized the revision process.
The Korea-U.S. FTA textile fabric origin standard requires the use of domestic yarns, but with this amendment, fabrics manufactured in Korea using offshore cuprammonium rayon yarns rather than Korean or U.S. yarns will be recognized as Korean products when exported to the U.S. and will be eligible for duty-free treatment.
As a result, it is expected that Korean textile companies will be able to expand their entry into the U.S. market by securing price competitiveness when exporting such products to the United States.
However, it is worth noting that cuprammonium rayon has a small market share compared to Viscose, Modal, and Lyocell(Tencel).
Reference: Ministry of Trade, Industry, and Energy press release, 2024, Jeong-geum Ryu, www.motie.go.kr