Ratio of Trade Volume with FTA Parties Increase to 36% [Korea, BYK]

http://www.mt.co.kr/view/mtview.php?type=1&no=2014022510254461985&outlink=1

SUMMARY:  According to Korea Customs Service (KCS), the trade volume with FTA partners took up 36.0% of the total trade volume of Korea in 2013.  This is a 1.2% increase from the previous year and also 2.5 times growth from the year 2010.  The amount of total trade with FTA partners increased 2.9% (3.5% increase in export and 2.2% increase in import).  The export to the United States increased 6.0% but import decreased 4.2%.  The rate of FTA utilization rose 4.9% to 66.9%.  The FTA utilization rate to the United States ranked high with 76.1%.  FTA to go into force with Australia and Columbia will boost the growth of FTA trade volume even more.

TPP Member Countries Demand Korea for Additional Opening of Agriculture Market [Korea, BYK]

http://www.nongmin.com/article/ar_detail.htm?ar_id=228875&page=5

SUMMARY: TPP member countries demanded Korea to open its agriculture market more widely and to resolve the pending quarantine issues.  MAFRA concluded preliminary bilateral talks with 11 out of 12 of TPP member countries.  During these talks, countries demanded Korea to open agricultural market above the KORUS FTA level.  The countries with FTA already in force- such as Chile, Peru, and Australia- also attempt to further open the Korean agricultural market.

Third Party Verification of FTA Origin Certification to be reinforced [Korea, BYK]

http://biz.chosun.com/site/data/html_dir/2014/02/18/2014021804045.html

SUMMARY: The third party verification of FTA Origin Certification will be fully enforced by MOTIE.  The ministry is planning to enlarge the verification system to 16 Regional FTA Support Centers within this year.  Experts will assist the cooperating company in authenticating the origin and the exporters will be free from the excessive verification requirement once this system is implemented.

Korea and Japan to Hold Bilateral Talks on TPP Next Month [Korea, BYK]

http://news.heraldcorp.com/view.php?ud=20140219000099&md=20140219082103_BB

SUMMARY: Korea and Japan are expected to hold bilateral talks on Korea’s participation in the TPP in early March.  Since both countries wanted a bilateral FTA, Korea predicts that it will obtain an approval without much difficulty.  Korean government will decide to join the negotiation as early as April, if there are no objection by the assembly and opposition of the public.

2. GRAIN & OILSEED ISSUES

Chairman of KITA Argues that Rice Tariffication is More Beneficial to Korean Rice Producers [Korea, BYK]

http://biz.chosun.com/site/data/html_dir/2014/02/25/2014022504222.html

SUMMARY: Duck-soo Han, Chairman of Korea International Trade Association (KITA), said that appropriate rice tariffication that prevents excessive import will profit Korean rice farmers.  Korean rice market was made an exception from Uruguay Round for 20 years.  As the exception period expires by the end of this year, Korea has to either open its rice market or increase the obligatory import volume.  The required volume in 2015 will be 408,700 tons, 8% of the average consumption of standard year (1988 to 1990).  However, this amount is considered as ‘too much’, since the annual consumption of rice has declined from 5.1 million tons in the late 1980s to 3.64 million tons in 2011.  Chairman Han insisted that tariffication is a better solution for Korean rice farmers because high tariffs on imported rice will lower the import volume.

Online Rice Market Grows Despite the Downfall of Rice Consumption [Korea, BYK]

http://biz.chosun.com/site/data/html_dir/2014/02/25/2014022504211.html

SUMMARY: The sales channel of rice in Korea is shifting toward Internet shopping.  Even though the rice consumption in Korea is shrinking, the sales amount of online rice market is growing.   According to Lotte Mart, the rice sales of online market increased 85.5%, while that of off-line market decreased 24.5%.  E-mart reported that 18% of the rice was sold online through E-mart Mall website.  Internet open markets, such as Auction or 11^th Street, are becoming the hub of online rice shopping.  The consumers can buy from local government, farming corporations, and even individual farmers through this channel.  The quality of rice is similar within the brand or region, unlike the products such as meat, fish, fruits or vegetables which customers tends to check the quality of each product with their own eyes.  This characteristic attributes to the growth of online rice market.

China Becoming a Big Importer of Rice…Predicted to cause International Rice Crisis [Korea, BYK]

http://www.nongmin.com/article/ar_detail.htm?ar_id=228640&subMenu

SUMMARY: China, the largest rice producer, is also becoming a big rice importer at the same time.  According to USDA, the amount of rice import in 2012 was 2.9 million ton, which is 7.8 times greater than that of the year 2010 (0.37 million ton).  The speed of rice consumption increase exceeded the speed of rice production increase, causing such a huge incline in the import.  The change in Chinese rice market is affecting the international rice trade.  According to aT, the price of Chinese rice more than doubled to US$ 895 per ton within 9 years.

3. LIVESTOCK ISSUES

Local Beef Resumed 50 Percent Market Beef Market Share in 13 Years [Korean, OSY]

http://news.donga.com/3/all/20140226/61233865/1

Summary: Korean Ministry of Agriculture reported on February 26 that local beef accounted for 50.3 percent of all beef supplied to the market in 2013.  Local beef has taken less than 50 percent of the beef market since 2000.  Production of local beef amounted to 260,000 metric tons in 2013, up about 8 percent from the previous year.  Increased consumer demand on local beef was the main cause of the increased production.  On the other hand, volume of imported beef supplied to the market showed a slight decline in 2013 mainly because of increased price under strong demand from China.  Australia remained the leading supplier of imported beef to Korea by accounting for 55.6 percent of the 257,000 metric tons of imported beef.  Imports from the U.S. amounted to 89,000 metric tons, or 34.7 percent of all imported beef.

MAFRA’s Countermeasures against AI (Feb. 25) [Korea, BYK]

http://www.mafra.go.kr/list.jsp?&newsid=155445401&section_id=

SUMMARY:  Five new suspected cases of AI have been reported since February 17^th.    Four poultry farms in Eumseong, Chungbuk; Nonsan, Chungnam; Pyeongtaek, Gyeonggi; and Cheonan, Chungbuk were diagnosed with HPAI.  A native chicken farm in Anseong, Gyeonggi was diagnosed with LPAI.  Especially, MAFRA predicts that 26 out of 31 farms in Eumseong have AI.  The ministry decided to cull duck farms in Eumseong as a precaution.  Furthermore, it is planning a full inspection on 1,000 duck farms all over the country.

MAFRA to Designate 'AI Danger ZONE' and Compensate Only 20% to Farms with three AI Outbreaks [Korea, BYK]

http://news.donga.com/3/all/20140225/61177176/1

SUMMARY: Ministry of Agriculture, Food, and Rural Affairs (MAFRA) will reinforce countermeasures against avian influenza (AI).  MAFRA will designate migratory habitats and past AI outbreak regions as the "AI Danger Zone".  The ministry will prohibit approval of new farms in the area and subsidize if the existing farms move out of the region.  Moreover, MAFRA will introduce three-strike-out system.  Currently, the government is compensating 80% of the culled poultry for AI outbreak.  The policy will change to 50% compensation for the second outbreak and only 20% for the third time around.

HPAI Diagnosed in Yeongam and Nonsan [Korea, BYK]

http://www.hankyung.com/news/app/newsview.php?aid=2014022335851

SUMMARY: HPAI showed indications of expansion despite the warm weather.  The AI virus was detected in Youngam, Jeonnam and Nonsan, Chungnam.  Poultry farms are the most densely located in Youngam.  From the diagnosed farm, 550,000 poultry are bred within the 3km radius and 45% of the ducks in Korea are bred within the 10km radius.  In Nonsan, 500 Ogolgye (black chicken) of Yeonsan are being raised.  Yeonsan Ogolgye is designated as nationally protected species only in Nonsan.  There also have been suspected reports from Yonggwang, Jeonnam; Cheonan, Chungnam; Anseong, and Pyeongtaek, Gyeonggi.

20 Countries Have Their Eyes on Korean Beef Import Market [Korea, BYK]

http://www.nongmin.com/article/ar_detail.htm?ar_id=228864&page=

SUMMARY: MAFRA reported to the Agriculture, Food, Rural Affairs, Oceans, and Fisheries Committee that 13 more countries requested Korea to open its beef import market.  It means that 20 countries, including the 7 countries allowed exporting, would like to export their beef to Korea.  Among the EU countries, Denmark, Austria, Italy, and Spain submitted import request form after Korea-EU FTA was implemented.  EU implied several times that they will take the issue to WTO if the import permission is further delayed.  The government divided 7 EU countries into 2 groups to progress the procedure.  Japan also complained about the follow-up measures being postponed.  Therefore, Korea completed pre-survey last December and will soon send the sanitary survey documents.  Moreover, 4 Latin American countries are pressuring Korea.  Brazil suggested Korea to import beef from Santa Catarina based on WTO regional regulation.  Vanuatu, a small island country in the South Pacific Ocean, requested beef import as well.

MAFRA to Ban Polish Pork Import due to ASF [Korea, BYK]

http://www.mafra.go.kr/list.jsp?&newsid=155445392&section_id=b

SUMMARY: MAFRA banned pork imports from Poland due to African Swine Fever (ASF) outbreak.  ASF virus was found in the carcass of a wild boar near the border between Poland and Belarus.  Korea is an ASF-free country, and this measure is to keep the virus from entering the country.

Cows in Gwangju, Gyeonggi Diagnosed with Tuberculosis [Korea, BYK]

http://www.yonhapnews.co.kr/bulletin/2014/02/19/0200000000AKR20140219191400061.HTML?from=search

SUMMARY: There was a tuberculosis outbreak in a Hanwoo farm in Gwangju, Gyeonggi Province.  A cow from a farm in Yeongok-ri, Gonjiam-eup was diagnosed with tuberculosis before it was slaughtered.  The city authorities ordered a standstill to 36 cows in the farms and sterilized the shed.  Cows in another farm in Yeongok-ri were also diagnosed with tuberculosis last month.

MAFRA to Expand Livestock Farms Subjected to License System [Korea, BYK]

http://www.mafra.go.kr/list.jsp?&newsid=155445383&section_id

SUMMARY: MAFRA reformed laws to expand the number of livestock farms that are subjected to licensing system.  The full-time scale farms need a permission of the ministry starting from the 23^rd.  Among the total 140,000 livestock farms, about 9,700 more farms will be licensed in addition to previously licensed 5,400 large scale farms.  The farms that did not get an approval or violated the standard will be punished according to the law.  Additionally, permission will be cancelled if the farm develops any pathogenic disease or refuses the culling order.  The licensing system is planned to be expanded to small scale farms by February 2016.

4. MARKETING ISSUES

Price of Imported Oranges Up 10 Percent in February due to Reduced Supply from the U.S. [Korean, OSY]

http://news.donga.com/3/all/20140223/61146977/1

Summary: Price of imported oranges sold in Seoul Metropolitan Produce Wholesale Market on February 23 was 64,000 won per 18kg box, which was 10 percent higher than one month ago.  The price increase was due to reduced supply of oranges from the U.S. caused by cold weather.  Reduced supply of imported oranges has also increased price of other imported fresh fruits, including grapes, bananas and pineapples.  Price of local tangerine oranges has shown even bigger price increase by marking 45,000 won per 10kg box on February 23, up 55 percent from one month earlier.

5. NORTH KOREA ISSUES

North Korea Requests Disease Control to UN FAO [Korea, BYK]

http://www.yonhapnews.co.kr/northkorea/2014/02/26/1801000000AKR20140226028500014.HTML

SUMMARY:  North Korea requested for assistance in disease control to Food and Agriculture Organization (FAO) of the United Nations on the 23^rd.  FAO had an emergency meeting with North Korean officials in Rome.  Considering the fact that the foot-and-mouth disease spreads rapidly, an FAO team will be sent in short order.  No further details, such as the date of dispatch or size of the team, have been decided yet.  Chosun Central News Agency reported that about 3,200 pigs in Pyongyang and North Hwanghae Province were infected by foot-and-mouth disease.

South Korean Government Lends a Helping Hand to North Korea by Offering Disinfectant and Vaccines [Korea, BYK]

http://news.khan.co.kr/kh_news/khan_art_view.html?artid=201402242202015&code=910303

SUMMARY: South Korean government offered to aid North Korea in its effort to fight against foot-and-mouth disease.  It is the first time Park Administration suggested a direct support to the North. If North Korea accepts the proposal, South Korea will send disinfectant and vaccines through a working-level contact.  Some suggest the inter-Korea relation has thawed after the family reunion.  However, the South Korean government drew a line by saying that it is a purely humanitarian act.  Pyongyang’s official news agency revealed that foot-and-mouth disease is spreading throughout the area due to the lack of vaccine, disinfectant, and diagnosing tool.  360 pigs died and 2,900 pigs were culled since January 8^th.

Foot-and-mouth Disease Outbreak in Pyongyang, North Korea [Korea, BYK]

http://www.hankyung.com/news/app/newsview.php?aid=2014022077341

SUMMARY: World Organization for Animal Health (OIE) announced that North Korea reported foot-and-mouth disease type O in Pyongyang and North Hwanghae Province.  The first outbreak was on January 8^th, but North Korea notified OIE on the February 19^th.   It is 3 years after the last outbreak in April 2011.  With ongoing AI, the disease control will be even more difficult.  MAFRA held an emergency meeting and decided to vaccinate and sterilize the border region, the northern part of Gyeonggi and Gangwon Province.  Gaeseong Industrial Complex workers will be sterilized and scanned thoroughly.  Attendees of family reunion have undergone emergency sanitation and education.

6. OTHER MISCELLANEOUS ISSUES

Shortage of Animal Husbandry Inspector in US... Turning "Red Light" on Food Safety [Korea, BYK]

http://www.yonhapnews.co.kr/bulletin/2014/02/22/0200000000AKR20140222012000072.HTML

ENTIRE ARTICLE:

New York Times reported on the 21^st that the Agriculture Department is facing difficulties in food safety due to an absolute shortage of inspectors that check the safety of meat in places such as a slaughterhouse.  Much controversy is expected as the department is planning to allow the factory employees to do the safety inspection in order to reduce the cost.  Concerns about the aftermath of this program are arising in Korea since the country is highly dependent on the US livestock.  The article also pointed out that Rancho Feeding Corporation's recall was caused by the absence of thorough investigation due to the lack of inspectors.  The Californian meat processor recalled 4,000 tons of beef products made from sick cows.  Stan Painter, the inspectors’ union representative, worried that plant employees and veterinarians are working as inspectors in many places.  Wenonah Hauter from Food and Water Watch, a consumer advocacy group, collected data under the Freedom of Information request.  She revealed that the inspector's workload has doubled or tripled due to the labor shortage, and warned that the inspection system is on the point of breaking.  She also sent a letter to the Agriculture Department criticizing the program on February 8^th.  The letter said that under the new program, the department allows poultry factory workers to audit the processing lines and Agriculture Department inspectors are stationed only at the final check point to cut the cost.

Agriculture Department is enforcing the program throughout the nation.  This is predicted to cause further controversy.

Anchovy Price Jumps 30% in One Month due to Decrease in Catch [Korea, BYK]

http://www.hankyung.com/news/app/newsview.php?aid=2014022335151

SUMMARY: Price of anchovy is surging because of a decrease in catch due to bad weather.  The price per 1.5kg box went up by 30% to around 9,000 won.  The amount of commission sales in February is only 578 tons, which is even less than 10% of the amount sold in January.  Anchovy fishing resumed in some regions but the quality is low.  The Fishery Cooperative strongly predicts that the price will continue to rise.

Sake Import Upsurges while Makgeolli Export Falls [Korea, BYK]

http://www.hankyung.com/news/app/newsview.php?aid=2014022335131

SUMMARY:  Sake is gaining popularity while Makgeolli is struggling.  According to Korea Customs Service, Sake import to Korea increased 15.4% to 4,367 ton. This success is attributed to preference for lower alcohol content and luxury marketing.  However, Korean traditional liquor Makgeolli is experiencing a downturn. Makgeolli consumed in Korea in 2013 was 366,470kL, which is a 6.8% decrease from the previous year, and export dropped 40.5% to 18,222 tons.  Experts blame the regulation on large companies from entering the Makgeolli market for this downfall.  Marketing that only relies on patriotism and Korean wave is accused as another factor.

(01-06-2014) MAFRA to Change TRQ Method for Onion, Garlic, and Chili Pepper: Lessen State Trading and Expand Quota Auction [Korea, BYK]

http://www.nongmin.com/article/ar_detail.htm?ar_id=227028&su

SUMMARY: MAFRA changed the tariff rate quota (TRQ) method to reduce state trading and expand quota auction.   For onion, the ratio of state trading decreased from 48% to 38%, while the ratio of quota auction increased from 52% to 62%.  For garlic, the ratio of state trading decreased from 79% to 69%, while the ratio of quota auction increased from 21% to 31%.  For chili pepper, the ratio of state trading decreased from 76% to 70%, while the ratio of quota auction increased from 10% to 16%.  The ministry discussed the merits and drawbacks of state trading after safety issues of imported chili pepper arose.  The dominant opinion was to let the free market run by enlarging participation of the private sectors, leading to a change in the TRQ method.