Today's Date:     Wednesday, February 01, 2012

1. BILATERAL/MULTILATERAL ISSUES

Korea should refuse “Regionalization” during FTA talks with China [Korean: BYK]

http://www.nongmin.com/article/ar_detail.htm?ar_id=198231&subMenu=articletotal

Summary: Most of the experts are asserting that the success of the FTA negotiations with China will depend upon whether Korea can get China to agree upon not including the “regionalization concept.”  The regionalization concept is something that would enable a country to continue to export agricultural products despite an outbreak of a disease in one area as long as the products being exported are not coming from that region.

Importers and retailers gobble up the benefit coming from FTA [Korean: BYK]

http://news.kbs.co.kr/economic/2012/02/01/2428254.html

Summary: There are a number of products where the price has not dropped, despite the fact that the import duties have been removed.  The most representative case is the Chilean wine.  The price of Chilean wine has increased since 2009 when the duty was eliminated.  This is the same with pork coming from EU.  The duty for frozen pork bellies dropped 2.5% but the domestic retail prices have gone up.  The National Tax Service sees this as a case where some of these retailers are not paying the proper amount of tax and plans to investigate the companies that are suspected of not paying the right amount of tax.

Farmers ask the MIFAFF Minister to resign and nullify the KORUS FTA [Korean: BYK]

http://news.naver.com/main/read.nhn?mode=LSD&mid=sec&sid1=102&oid=003&aid=0004315896

Summary: Farmers in Chungju gathered in front of the Chungju Policy Office and demanded that the MIFAFF Minister resign from his post for having caused the arrest of 14 farmers who protested when the Minister visited that region to provide explanation about the KORUS FTA.

Korea Customs Office to strengthen origin verification measures [Korean: YJY]

http://www.weeklytrade.co.kr/sub_read.html?uid=22231&section=sc1&section2=

Summary: Bearing in mind both the KORUS FTA and Korea-EU FTA, it is expected that there will be an increase in a third country’s goods flowing into Korea illegally.  Korea Customs Office claimed that from Feb. 1^st it will strengthen measures to check origin of agricultural goods.  Since high tariff rates imposed on certain agricultural goods will be significantly decreased or even eliminated, a third country will attempt to evade tariff by disguising as either American or European goods.

Korean government to support agricultural industry with KRW 24.1 trillion in face of the KORUS FTA [Korean: YJY]

http://www.segye.com/Articles/NEWS/ECONOMY/Article.asp?aid=20120131002409&subctg1=&subctg2=

Summary: Including tax benefits, support fund will mount up to KRW 54 trillion. The government already used a quarter of KRW 24.1 trillion.  The government claimed that it will increase competitiveness of agriculture and fishing industry supporting KRW 1.86 trillion.  It will focus on building infrastructure such as stables, gardening, and orchards for high value-added agricultural and fishing industry.  Ministry of Strategy and Finance said that FTA support has never taken such a big portion in government revenue. 

Apple, Korea citrus enjoy the benefit of FTA [Korean: CJW]

http://www.nongmin.com/article/ar_detail.htm?ar_id=198233&subMenu=articletotal

Summary: The impact of South Korea EU FTA and KORUS FTA will leave some fruit items to suffer.

According to KREI Agricultural Outlook Center’s ‘2012 Outlook on Fruits,’ apples will grow by 9,000t in 2012 and 9,500t in the following year.  Korean citrus is also expected to have a direct impact.  KREI predicted 160,000t of orange imports in 2012 when KORUS FTA is put into effect.

2. ECONOMIC ISSUES

Increase in subsidy for organic agricultural industry [Korean: YJY]
http://news.mk.co.kr/newsRead.php?year=2012&no=66868

Summary: From this year, more subsidies will be paid to organic farmers that do not use pesticides in order to expand organic industry.  Subsidies provided to organic farmers will increase by 50% and the period will be extended from 3 years to 5 years.

Organic product “too expensive” [Korean: CJW]

http://www.nongmin.com/article/ar_detail.htm?ar_id=198259

Summary: When purchasing organic products, price burden (80.2%) and suspicion (61.1%) interfere with the consumption.  According to organic food awareness survey conducted by Embrain Trend Monitor, most women said that they feel the pinch.

3. GRAIN & OILSEED ISSUES

Consumption of rice in the year 2011 lowest since 1971 [Korean: YJY]

http://www.segye.com/Articles/NEWS/ECONOMY/Article.asp?aid=20120201000076&subctg1=&subctg2=

Summary: While eating habits have Westernized and consumption of processed food have increased, consumption of rice has recorded the lowest since 1971.  According to MIFAFF and Statistics Korea, consumption of rice for one person per day is 195g average.  The Korean government has implemented policies to encourage rice consumption, but they haven’t worked.

4. LIVESTOCK ISSUES

Cattle prices expected to climb up again when the policy for reducing the number cows are complete [Korean: BYK]

http://www.nongmin.com/article/ar_detail.htm?ar_id=198243&subMenu=articletotal

Summary:  KREI projected that the cattle prices will come out from the low price situation in 2014 when the cow reduction measures is completed.  The overall cattle number is expected to continue to drop up to 2014.

5. MARKETING ISSUES

Japanese consumption elevated due to rice museum [Korean: CJW]

http://www.nongmin.com/article/ar_detail.htm?ar_id=198234

Summary: Rice museum opened last month by the National Agricultural Cooperative Federation, or Nonghyup, is expected to promote domestic agricultural consumption and contribute to national health.  According to Nonghyup Economic Research Institute (NHERI), “Korea’s rice museum linked with agricultural museum can have synergy effects to make known the importance of farms with the aim to increase the value of rice.

6. OTHER MISCELLANEOUS ISSUES

Korean traditional liquor Maggolli “Nubo” hits the market [Korean, LSH]

http://news.khan.co.kr/kh_news/khan_art_view.html?artid=201201302111435&code=920401

Summary: “Maggolli Nubo,” Korean traditional liquor made by 2011 harvasted rice, has been sold nearly 3 million bottles during only 2 months. The sales have been increased by 31% compared to last year. MIFAFF benchmarked marketing of French wine Beaujolais Nouveau for Maggolli Nubo. The last Thursday of October each year has been set as Maggolli day. MIFAFF plans to release 2012 rice Maggolli Nubo this year to continue the Maggolli day and enhance exports expecting about $80 Million.

Korean Coffee Franchise Heads to the Big Apple [English, CSY]

http://english.chosun.com/site/data/html_dir/2012/01/31/2012013101239.html

Summary: The first overseas branch of Caffé Bene opened on Broadway's W 49th Street near Times Square in Manhattan last Friday, and its reception by New Yorkers has exceeded all expectations.   It is rare for a non-U.S. coffee franchise to open a store in a major U.S. city in these days of contracting financial markets, when even many local cafes are closing down as big-name coffee chains like Starbucks enlarge their presence and market shares. For example, there are now more Starbucks in Manhattan than there are metro stations. 

7. MIFAFF PRESS RELEASES

A hint of radioactive material Cesium was detected in frozen mackerel and frozen pollack packaged in Tokyo (Jan. 19) and Hokkaido (Jan. 25) after the Fukushima nuclear crisis.

MIFAFF plans to establish ‘2012 fishery safety assessment plan’

MIFAFF will raise subsidy to environmentally-friendly farming and extend its payment period.

MIFAFF announced dried pollack and seaweed as February’s in-season well-being aquatic products.

MIFAFF Minister, Seo Gyu-yong, will visit Animal, Plant and Fisheries Quarantine and Inspection Agency (QIA) on Feb. 1.

MIFAFF (Minister, Seo Gyu-yong) announced managerial status of ‘sinmungo’ which communicates with fishing villages and 7 key working tasks.