CREDIT GUARANTEE ALLOCATIONS TO REPUBLIC OF KOREA ANNOUNCED
                                                               
                                            Release No. 0455.97
                                                               
                                    Tom Amontree (202) 720-4623
                                             tamontree@usda.gov
                         Christopher Goldthwait (202) 720-5173 

CREDIT GUARANTEE ALLOCATIONS TO REPUBLIC OF KOREA ANNOUNCED 

     WASHINGTON, Dec. 29, 1997--The U.S. Department of Agriculture today
announced the detailed allocation of  its $1-billion credit guarantee
program to assist sales of U.S. agricultural commodities to Korea under the
Commodity Credit Corporation's Export Credit Guarantee Program (GSM-102) for
fiscal year 1998.  

       "Today's operational details for these sales implement the program
announced last week by Secretary Glickman making the $1 billion in GSM-102
export credit guarantees available to Korea for use this fiscal year," said
Deputy Secretary of Agriculture Richard E. Rominger.

     "Korea is an important market for U.S. agriculture, both for bulk and
consumer ready foods.  In fact, Korea was our fourth largest market for food
and agricultural products last year." Rominger said.  Commodities covered in
this initiative include cotton, corn, soybean meal, soybeans, wheat, beef,
pork, poultry, and a variety of horticultural products."
     
     "We are committed to helping Korea stabilize and rebuild its market. 
Our response to Korea's request for credit guarantees should help ensure
that Korea remains a key market for U.S. exports of food, feed, and other
agricultural products," Rominger said.

     Under the commercial GSM-102 program, USDA guarantees private export
financing for American agricultural products.  The program leverages
financing from the private sector to support and encourage U.S. agricultural
exports to major foreign markets.

     GSM-102 export credit guarantees, administered through USDA's
Commodity Credit Corporation, underwrite credit extended by the private
banking sector in the United States to approved foreign banks using dollar-denominated letters of credit to pay for U.S. food and agricultural products
sold to foreign buyers on extended credit terms.  Because payment is
guaranteed by USDA, financial institutions in the United States can offer
competitive credit terms to foreign banks.

     The Program Announcement for export credit guarantees to Korea is
issued in accordance with 7 C.F.R. 1493.10(d).
                                
                                
                      COMMODITY ALLOCATIONS
     Exporters may apply for credit guarantees on a first-come-first-served
basis to cover sales of any of the commodities specified below.  

Commodity      		Immediately Allocated    Balance for FY98     Total Coverage

Cotton             	$130 million  		 $ 70 million     	$200 million
Corn (white & Yellow)   $ 80 million  		 $270 million   	$350 million
Soybean meal        	$ 55 million		 $ 45 million 		$100 million
Wheat                   $ 85 million  		 $ 65 million        	$150 million
Other Commodities:  	$ 50 million   		 $ 50 million           $100 million

Meat (frozen or chilled
     beef, pork and
     poultry);

Horticultural Products,
including--dried fruit
(raisins, prunes, dates,
and figs); fresh fruit
(grapes, grapefruit, 
oranges, and tangerines);
potatoes (cut and chilled 
or frozen; flakes; 
granules); tree nuts 
almonds, pecans, pistachios,
walnuts, and hazelnuts)

Reserve                				$100 million     	$100 million

Total                  $400 million 		$600 million      	$  1 billion


     Specific details on the unallocated amount of $600 million will be issued
later.  The indicated commodity breakdown is tentative and subject to change.
     
     The allocations for Other Commodities, corn, and soybean meal do not assign
dollar amounts to any of the specified commodities and provide buyers and sellers
maximum flexibility in arranging the size of their transactions within the scope
of these allocations.  Within the category, "Other commodities," coverage is
expected to be used largely for red meat sales.  

                          TERMS OF COVERAGE
     In accordance with section 1493.20(v)(1), this announcement offers coverage
on an f.a.s. or f.o.b. basis. 

     Coverage up to 98 percent of the principal is offered on credit terms from
90 days to 2 years.  Adjustable interest coverage is also offered in accordance
with FAS Program Announcement PR-1080-94, issued Sept. 26, 1994.  
    
                            ELIGIBLE BANKS

     Any bank approved by CCC in Korea is eligible.  Exporters are advised to
obtain from their foreign buyer the name of the CCC-approved foreign bank that
will be opening the letter of credit.

                        GUARANTEE FEE RATES

     Pursuant to section 1493.70, fees are as stated in Program Announcement PR-1080-94, issued Sept. 26, 1994.

                    SPECIAL TERMS AND CONDITIONS

     Sales must be registered with CCC by Sept. 30, 1998, and exporters'
contractual arrangements must call for exports no later than Nov. 30, 1998.

     Under this announcement, credit terms must provide for semiannual payments
of principal plus accrued interest in any case where the credit period exceeds 6
months.  

                                  
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