SEOUL (AFP) -- South Korea and Australia will begin a joint study this year on a possible free trade agreement, a senior official said on Wednesday.

"The study by private research institutions from both countries will be conducted this year," Deputy Trade Minister Kim Han-Soo said in a statement to a meeting of business leaders.

"When the study is completed, government officials from the two sides will meet to set parameters for preliminary discussions," he said in the statement distributed by the Federation of Korean Industries and quoted by Yonhap news agency.

Kim's ministry confirmed the plan.

South Korea last month reached a landmark free trade deal with the United States, which has still to be ratified, and last week began talks with the European Union.

Kim, responding to the federation's request for a quick start to talks with Australia, said "a cautious approach is needed" because of sensitive agricultural sectors.

South Korea managed to exclude its culturally sensitive rice sector from the U.S. talks but pledged to open its beef market wider to U.S. exports, a move which could hurt Australian farmers.

Australia is South Korea's eighth largest trading partner with two-way trade reaching some 14 billion dollars a year.

Exports account for more than 70 percent of South Korea's gross domestic product and the government has been pushing aggressively for deals. It has signed FTAs with Chile and Singapore. One with the Association of Southeast Asian Nations, excluding Thailand, will take effect on June 1.

Thailand, the world's top rice exporter, refused to join the agreement to protest at South Korea's insistence on excluding rice.

Seoul is reportedly close to a pact with Canada and in June is set to begin a second feasibility study with China on a potential deal.