Compare and contrast item 1 with 2 and 31. US-China soybean trade tiff resolved - US
farm group |
WASHINGTON - A trade dispute between the United States and China over genetically modified foods has been resolved, opening the door for renewed sales of U.S. soybeans to China, a U.S. farm group official said this week.
"Indeed, the issue with biotech (regulations) is resolved," said Stephen Censky, chief executive of the American Soybean Association, which is based in St. Louis.
U.S. Trade Representative spokesman Richard Mills confirmed China has, "made a proposal which it describes is designed to remove obstacles to U.S. exports."
Mills added: "We are discussing with the Chinese how to implement its proposal in a way that will allow U.S. soybean exports to resume at normal levels."
U.S. soybean exports to China had been suspended due to confusion over China's rules on imports of bio-engineered foods. About 70 percent of U.S. soybeans are grown from genetically-modified seeds.
The trade dispute was threatening up to $1 billion in sales of U.S. soybeans to China.
In recent weeks, Bush administration officials have speculated China was creating uncertainty about its biotech rules simply to slow soybean imports and strengthen prices and markets for its domestic soybean growers.
Censky, in a telephone interview with Reuters, said he was informed this week by U.S. Agriculture Department and U.S. Trade Representative officials of the breakthrough.
As a result, Censky said he was "still hopeful" his industry could achieve its goal of shipping $1 billion worth of soybeans to China this marketing year, which runs until Aug. 31, 2002. "China still needs the beans," he said.
Censky said he also was "hopeful" U.S. exporters would not face burdensome quarantine and inspection procedures once shipments reach Chinese ports. In recent weeks, there have been reports that boats loaded with South American soybeans have faced unusual delays once arriving at those ports.
TRANSITION PERIOD
In early June, China announced it was imposing new controls on imports of genetically modified foods. But since then, the Chinese government has not provided any details on the safety assessments U.S. exporters must provide.
The absence of detailed rules made Chinese importers leery of taking a chance on buying U.S. soybeans since it was unclear whether any shipments would be accepted or rejected at port.
As a result, the U.S. industry asked for clarifying rules and a transition period for those rules to take effect.
"They gave us the transition period we wanted," Censky said.
He added that China has not indicated when it would produce the detailed regulations to enforce new rules on imports of genetically modified foods.
"We understand from reports the Chinese are still working on those," Censky said.
The apparent breakthrough came after U.S. officials at the highest levels complained about China's trade practices.
Last week in Shanghai, at a meeting of Asian-Pacific country leaders, President George W. Bush discussed the problem with Chinese leaders. Those conversations came a day or so after Zoellick and Chinese trade officials talked at length.
Censky said any new purchases of U.S. soybeans will take 30-45 days to arrive at Chinese ports.
September and October are typically heavy booking periods for U.S. soybeans destined for China, as the new U.S. crop is coming to harvest.
The interruption in China trade, coupled with seasonal factors, has contributed to a drop in the price of U.S. soybeans. November soybeans closed at $4.20-1/2 per bushel in Chicago Tuesday, down from July's 10-month high of $5.38 per bushel.
SHANGHAI : Chinese traders said on Wednesday they were sceptical of reports that a Sino-US row over genetically modified food had been resolved and that they wanted details before ordering new soyabean shipments. The American Soybean Association in St Louis said on Tuesday the genetically modified organisms (GMO) issue had been resolved and that China had agreed to a grace period to allow imports free of the rules while it worked on their implementation.
But frustrated traders said they would only consider the issue settled when both governments spelt out the specifics of how they ironed out the problem.
Without clarity, new orders for US soyabeans were unlikely, even though Chinese crushers were due to out run of the beans by the end of the year, they said.
"The issue is not resolved until we see some real details on the proposal," said a trader at a foreign trading firm in Beijing. "It's all just talk so far."
US Trade Representative spokesman Richard Mills said in Washington on Tuesday that China had come up with a proposal to remove the obstacles that brought the $1 billion soyabeans trade between China and the United States to a halt.
Last week, US Trade Representative Robert Zoellick said at an Asia Pacific Economic Cooperation (Apec) forum in Shanghai progress had been made during talks with Chinese counterparts.
A trade source in Beijing said China would consider giving out safety certificates if the United States could provide health information on a gene approved for use in America.
"My understanding is they discussed GMO registration," the, trade source said.
Other traders in China said while the comments by US officials offered a glimmer of hope, questions still outnumbered answers and the problem was far from over.
"We still don't know how to submit reports to get approval from Chinese authorities for a licence to bring in those GMO beans booked after June 6, and when and how long is that transition period? We don't know," said another Beijing trader.
A lack of details of China's GMO rules announced on June 6 has kept the soyabeans market on tenterhooks ever since, with traders wary of placing orders for fear their cargoes might not pass China's strict quarantine rules.
Last month, China tightened its grip on soyabean cargoes, including those from South America, in what the trade saw as a move to try to control surging imports after China enters the World Trade Organisation, probably later this year.
Chinese analysts say the entire quarantine procedure, from inspections and sample testing to cargo discharge, can take more than 20 days.
Some traders said port authorities appeared to have eased quarantine procedures slightly ahead of last weekend's Apec summit in Shanghai, but it was unclear whether that was permanent.
"I heard that the entire quarantine procedure doesn't take as long as before and some cargoes can be discharged in fewer days," said a third trader with a foreign trading firm in Shanghai.
"But we are still worried about making new deals before we are absolutely clear of the inspection process," she said.
An official at Chiwan port in the southern city of Shenzhen said it only needed two days instead of four to unload a cargo, but the rest of the inspection process remained stringent.
She gave no estimate of how long the entire quarantine procedure took.
Traders and industry officials said they doubted China could wait long before it had to start importing again because stocks of domestic beans, almost completely harvested by now, would run out at the end of the year.
China usually has an annual shortage of 12 million tonnes of soyabeans.
"The domestic crop all gets harvested in September and October. So for a few months, sure there are domestic beans," said Phillip Laney, China country director for the American Soybean Association in Beijing.
"The shortage is ultimately going to be there unless imports resume," he said.
China's soybean imports have been greatly affected since the Ministry of Agriculture issued a Regulation of Safety of Genetically Modified Organisms (GMO) in June this year.
The regulation was issued to establish a much stricter inspection system to ensure the safety of GM foods. After the regulation was made public in June, traders immediately imported soybeans to gain an advantageous position, speculating that imports in the following months would fall.
In July, China's imports of soybeans exceeded 1.83 million tons, an increase of 32 per cent from June. The imports in August reached 1.78 million tons. The wholesale price of soybeans nationwide reached an average of 2,117 yuan (US$256) per ton in July, compared with 2,108 yuan (US$255) per ton in May.
However, the rise in price lasted only a short period and in August, wholesale prices fell below that of May to 2,097 yuan (US$254) per ton. The drop was largely a result of the mass import of soybeans in July and August in the wake of the announcement. The June announcement also led to a significant change in soybean suppliers - Argentina and Brazil have replaced the United States as the primary supplier for China.
The amount of soybeans China imports from the United States has dropped sharply since the regulation was issued, leaving many local experts believing that US traders might feel that their soybeans could not meet China's new rule. Monthly imports of soybeans from the United States averaged 160,000 tons in June and July, compared with 1.15 million tons in April and May.
In August, China did not import any soybeans from the country. In September, US imports were restored but often delayed due to quarantine. Consequently, imports from Argentina and Brazil have grown by a large margin since June.
In the first four months of this year, China did not import soybeans from Argentina and only imported a small volume from Brazil. But in May alone, China imported 50,000 tons from Argentina and 290,000 tons from Brazail .
In August, imports from Argentina totalled 1.15 million tons and imports from Brazil surpassed 600,000 tons. In the first eight months of this year, 47 per cent of China's soybean came from the United States, 30 per cent from Argentina and 23 per cent from Brazil.
According to statistics, genetically modified organisms are widely dispersed across the United States, Argentina, Canada and Mexico. Some 300,000 hectares in China cultivate genetically modified organisms, accounting for about 1 per cent of global acreage. copyright 2001 by chinadaily.com.cn.
Thanks for sending these articles to Norfolk Genetic Information Network (ngin), http://www.ngin.org.uk 25oct01
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