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Food News Clipping

November 29, 2013

2013.11.29

FAS/Seoul Monitoring of Media Reporting on Agricultural Issues
Today's Date:   Friday November 29, 2013
For Coverage:   November 13 - 29, 2013
  

 

1. BILATERAL/MULTILATERAL ISSUES

 

Japan¡¯s TPP Meets Obstacle on Tariff Elimination Criteria (Korean, LSH)

http://www.hankyung.com/news/app/newsview.php?aid=2013111777751&intype=1

Japan¡¯s attempt to participate in TPP is experiencing difficulties as the U.S. strongly urged for tariff elimination of all imports.  Japan was originally planning to exempt some of sensitive products like rice and beef from the tariff elimination criteria but was not agreed toby the U.S.   Yomiuri News illustrated that the Japanese government started to review measures to increase rice imports from U.S.

 

Korea Expected to Show 2.6 percent Growth in GDP with Participation in TPP (Korean, LSH)

http://www.newsis.com/ar_detail/view.html?ar_id=NISX20131114_0012514208&cID=10401&pID=10400

It is expected that when Korea participates in TPP, it will bring about 2.6 percent GDP growth.  According to Korea Institute for International Economic Policy, Korea¡¯s export of products like cars, textiles and petroleum refinery products will sharply increase thereby improving the trade balance. In terms of imports, imports of machinery, chemicals and food products will increase. However, there are also contrasting opinions on the issue of TPP as well, insisting that TPP will not bring benefits to the economy and rather damage domestic small and middle sized industries.  

 

2. GRAIN & OILSEED ISSUES

 

Government Proposes that Regulation on Soybean be Exempted. [Korean, CSC]

http://www.hankyung.com/news/app/newsview.php?aid=2013111383991&intype=1

Korean government officially requested National Commission for Corporate Partnership(NCCP) to withdraw regulation on soybean production which was to be only sold to mid-sized companies.  Under the regulation, domestic soybean products could be only sold to the middle and small sized companies.  This resulted in oversupply and dragged the price down and finally jeopardized the soybean farmhouses.In order to use domestically produced soybean in large amounts and assist domestic farmhouses, big companies must be allowed to consume the domestic soybean as well. NCCP and MAFRA must negotiate to ensure coexistence of both companies and also to help farmhouses.

 

3. LIVESTOCK ISSUES

 

Imports of American Beef Further Decline Despite KORUS FTA ¡¦ Australian Beef Continues to Lead the Imported Beef Market [Korean, OSY]

http://news.donga.com/3/all/20131113/58880882/1

Summary: According to the industry, imports of beef during January through September this year amounted to 184,421 metric tons, down 0.4 percent from the same period last year.  Beef imports have continued a decline after topping at 289,386 metric tons in 2011.  The main reason for the decline has been increased domestic beef supply and rise of the price of imported beef.  Imports of American beef declined 18.3 percent during January through September this year despite the implementation of KORUS FTA.  On the other hand, imports of Australian beef rose 20.9 percent during the period.  Marketers point out that American beef is yet to recover from the bad consumer image associated with BSE outbreaks several years ago while Australian beef has successfully differentiated itself from American beef by promoting ¡°grass-fed clean beef¡± message to the Korean consumers.  Although the U.S. currently focuses on opening up the Korean market for beef from cattle over 30 months of age as a tool to expand its market in Korea, local marketers agree that this approach would have little impact to the consumption trend in Korea because Korean consumer¡¯s safety perception about the American beef remains the key to the problem.

 

Alleviation of Global Beef Import Standard will result in Increased Pressure to Korean Government. [Korean, CSC]

http://biz.chosun.com/site/data/html_dir/2013/11/13/2013111303306.html

USDA¡¯s decision to allow import of boneless beef of more than 30 months old is expected to encourage the U.S. be more active in expanding markets for U.S. beef overseas.  To this stance, Korean government believes that it will somehow act as a pressure for Korean government as well to open up the import for beef more than 30 months old.  For Korea and Japan which have been restricting import of beef more than 30 months old, this progress by the  U.S. government will contribute to changing that government¡¯s stance and to establish more intimate trade relations.

 

The U.S. Requests Extension of Domestic Beef Trade Markets (Korean, LSH)

http://www.hankyung.com/news/app/newsview.php?aid=2013111817581&intype=1

The U.S is expected to require additional opening of the Korean beef market by allowing trade of beef from cows more than 30 months old.  Ever since resuming beef imports by agreeing to import sanitation requirements in 2008, only beef under 30 month of age was traded and distributed to Korean consumers. However, the U.S. takes the position that it is the time that extension of trade is necessary. As the U.S. has become BSE-free nation last May, other nations must also refer to the standard and allow additional beef imports.

 

4. MARKETING ISSUES

 

E Mart Continues to See Loss from its Stores in China ¡¦ Lotte Also Reports Loss from the Stores in Foreign Markets, Largely from China [Korean, OSY]

http://www.hankyung.com/news/app/newsview.php?aid=2013111547001

Summary: According to E Mart¡¯s IR Report released on November 14, E Mart saw 10 billion won of loss from its 16 stores in China in the third quarter 2013, which increased the total loss of E Mart stores in China this year (through third quarter) to 42 billion won.  E Mart explained that the business environment in China continued to favor the growth of local retailer companies at the expense of foreign investors.  Lotte Mart also reported a total of 42 billion won of loss from its 142 stores in foreign markets (104 in China) through third quarter this year.  Lotte Mart¡¯s stores in China was responsible for a majority of the loss.

 

E Mart Offers Kirgizstan Walnuts through a Sales Promotion [Korean, OSY]

http://news.donga.com/3/all/20131126/59162938/1#

Summary: E Mart kicked off sales of Kirgizstan walnuts on November 26 with a promotional event.  400 gram pack is offered at 9,680 won.
 
 

Korea Recreation-Restaurant Industry Association Plans to File a Request to the ROK Government to Include cafe, Pizza, Hamburger Restaurant Business to ¡®Designated Industry for Small to Medium Size Companies¡¯, Inclusive of Those under Foreign Ownership such as Starbucks, McDonalds and Pizza Hut [Korean, OSY]

http://www.fnnews.com/view?ra=Sent1001m_View&corp=fnnews&arcid=201311250100270900014003&cDateYear

Summary: Korea Recreation-Restaurant Industry Association (KRRIA) reported on November 26 that it was planning to submit a request to the Korean government in early December to include coffee, pizza and hamburger restaurant business additionally to ¡®Industries designated for small to medium size companies¡¯.  KRRIA added that its request will cover those businesses that are owned/operated by foreign companies such as Starbucks, McDonalds and Pizza Hut.  The ¡°co-growth¡± regulation introduced by the Korea Fair Trade Committee in November 2012, has prohibited opening of new outlets (stores) within 500 meter distance from existing outlets under same franchise brand if the industry was designated as ¡®Industry Designated for Small to Medium Size Companies¡¯.  The Bakery store sector was a key industry that received the designation.  Companies under foreign ownership such as Starbucks and Coffeebean were exempted from the designation since these foreign outlet/companies were largely direct-owned by the local franchiser.  Starbucks Korea commented on November 26 that it would stay alerted on any further development in the regulation as the restriction suggested could be a violation against trade agreements that Korea has with foreign countries.

 

5. OTHER MISCELLANEOUS ISSUES

 

Yeonhae-ju (the Maritime Province of Siberia) becoming a New Base for Food Storage. [Korean, CSC]

http://www.hankyung.com/news/app/newsview.php?aid=2013111109161&intype=1

Ever since domestic firms participated in international agricultural development project in 2009, the volume of crops produced in Yeonhae-ju increased sharply.  Yeonhae-ju is a region in Russia adjacent to the border with North Korea and currently 15,000 ha of land is being cultivated. As a part of Korea-Russia cooperation effort, Yeonhae-ju development project has been promoted by both nations in the summit conference. 15,000 tons of corns for feedstuff use were produced and imported to Korea and additional wheat production is expected to solve domestic self-sufficiency issue. If the farming in this area develops it will provide increased outcome and guarantee price competitiveness of the products.

 

 

The information in this report was compiled by the Agricultural Trade Office (ATO) at the U.S. Embassy in Seoul, South Korea. The press summaries contained herein do NOT reflect USDA, the U.S. Embassy, or other U.S. government agency official policy or view point. U.S. food exporters can learn more about market opportunities in South Korea by reviewing ATO Seoul¡¯s Exporter Guide and other reports available at www.fas.usda.gov by clicking on ¡°attaché reports

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Agricultural Trade Office, U.S. Embassy - Seoul
Tel: 82-2-6951-6848 Fax: 82-2-720-7921
Email: atoseoul@state.gov