1. BILATERAL/MULTILATERAL ISSUES

10 Years of Korea-Chile FTA...Total Trade Grew 4.5 Times, Income of Grape Farmers Doubled [Korean, KSY]

http://biz.chosun.com/site/data/html_dir/2014/03/27/2014032702341.html

SUMMARY:  According to Korea Customs Service (KCS), trade between Korea and Chile in 2013 reached US$7.1 billion. It is 4.5 times larger than 2003, the year before the free trade agreement came into force.  Korean export in Chile grew 5 times from $0.5 billion to $2.5 billion, while Chilean export to Korea increased 4.4 times from $1.1 billion to $4.7 billion.  Contrary to the concerns, the damage of FTA on Korean agriculture was not as much as concerned.  Annual income of grape farms per 1,000 meter square increased from 2.25 million won in 2003 to 4.35 million won in 2013.  It is true that the import of grape increased from 9,000 tons in 2003 to 47,000 tons in 2013. However, due to the seasonal tariff, most of the Chilean grapes are imported in January to May when the grapes are not harvested in Korea.  Chilean pork import increased 3.4 times in monetary value, but it did not have much influence on Korean pork.  The Korean government predicts the trade with Chile will increase from this year since tariffs on many products is eliminated.  This year, Korea abolished tariffs on 473 agricultural fishery products, including pork belly and kiwi.

2. BIOTECHNOLOGY ISSUES

US Organic Processed Foods to Enter without Korean Certification from June [Korean, KSY]

http://news.khan.co.kr/kh_news/khan_art_view.html?artid=201404010600005&code=920501

SUMMARY:  According to the report by Ministry of Agriculture, Food, and Rural Affairs (MAFRA), both Korean and the US governments are planning to sign ‘Organic Equivalency Agreement’ by this June.  The organic processed food from the United States will enter Korea without going through Korean certification process once it is signed.  The Korean delegates visited the US organic processed food factory sites in February, and the US delegates visited Korea from the 17^th to 21^st of March for an on-site evaluation.

The problem is that there are too many key issues to discuss in two months from April and May.  Korea has stricter rules on genetically modified organisms (GMO) and food additives.  Korea does not allow any traces of GMO, while the United States permits up to 5%.  In addition, the United States approves 20 more permissible food additives than Korea.  On the other hand, organic certification on grass-feeding livestock is more meticulous in the United States than in Korea. Grazing is mandatory in the US organic certification.  Also, the United States does not accept any usage of antibiotic in organic livestock.  Ju-seon Park, National Assembly member of the New Politics Alliance for Democracy Party, insisted that the Korean government is not enforcing the organic certification for year because of the United States.  He argued that the agreement should not be signed in a rush nor surrender to the pressure from the United States by implementing an educational period once again.  MAFRA said that it will not sign the agreement in June if the discussion is not settled within the next two months.

MAFRA Introduces Educational Period for ‘Certification System for Organic Processed Foods’ without any Legal Basis [Korean, KSY]

http://news.khan.co.kr/kh_news/khan_art_view.html?artid=201403250600035&code=920501

SUMMARY:  It was revealed that Ministry of Agriculture, Food, and Rural Affairs (MAFRA) introduced a six-month-long educational period for ‘Certification System for Organic Processed Foods’ without any legal basis.  The report by the Board of Audit and Inspection of Korea pointed out that MAFRA did not impose sanctions on imported organic processed foods without domestic certification two days before the labeling system was repealed because of the complaint from the exporting countries such as the United States.  MAFRA’s explanation that the educational period was for domestic firms to adapt to the new law turned out to be a lie.  MAFRA is being criticized that it has put off restriction due to the pressure from the United States.  The organic labeling from the United States cannot be used in Korea until both parties agree on the ‘Organic Equivalency Agreement’.  Both governments are looking forward to conclude the agreement within the educational period.  Experts advise Korea to be cautious with the equivalency agreement with the United States.  It is because the United States allows 5% of adventitious presence of GMOs, compared to Korea which does not allow any.  Moreover, the United States permits 98 kinds of food additives while Korea approves only 78.  The market size of the imported organic processed food market is US$64.08 million in 2011, and the United States took up 24% ($15.55 million) of the market.

3. GRAIN & OILSEED ISSUES

[Opinion] Government Must Defend Agriculture through an Active Negotiation on Rice (Jong-hyeok Lee, Chief of Policy of Korean Peasants League) [Korean, KSY]

http://www.hani.co.kr/arti/opinion/because/629586.html

SUMMARY:  Rice farming is in a crisis due to rice tariffication.  The Korean government insists that the tariffication on rice is unavoidable, and there will not be any rice import with high tariff.  However, the farmers assert that there is no specific clause in World Trade Organization (WTO)'s Agreement on Agriculture regarding the rice tariffication after the year 2015.  It is the farmers' understanding that this issue needs to go through a negotiation, and the Korean government should not be the first to propose rice tariffication.  The farmers argue that the government has no will to impose high tariffs, and even though it does, the tariff will be eliminated because of various free trade agreements and Trans Pacific Partnership.  The government gives the case of Philippines as an example, where the country had to increase the tariff ratio quota (TRQ) to 900,000 tons to be tentatively exempted from rice tariffication.  If this is viewed another way, it means that the damage from rice tariffication is bigger than increasing the amount of TRQ or lowering the tariff on TRQ.  In case of India, the government violated the WTO Agreement by purchasing food in a support price by spending 19 billion dollars.  However, the Indian government gained consent from the member countries and protected domestic agriculture.  The Korean government must stop acting foolish by giving up even before attempting to negotiate and lead an active renegotiation.

4. LIVESTOCK ISSUES

'Cheap and Safe' Australian Beef Threatens Hanwoo [Korean, KSY]

http://www.nongmin.com/article/ar_detail.htm?ar_id=230209&subMenu=articletotal

SUMMARY:  Australian beef is making inroads into the beef market in Korea with its low price and unpolluted image.  According to statistics by Korea Meat Import Association, the amount of Australian beef import recorded 27,198 tons from this January to March 10^th, which is a 20% increase compared to the same period last year. On the other hand, the amount of US beef import declined 10% to 21,333 tons.  Australian beef is cheap, and it has an advantage over US beef with its ‘BSE-free’ image.  It used to be considered tough meat texture, but it improved through feeding grain.  With growing preference, the main consumer is shifting from group food service to individual households.  Experts say that in order to compete with cheap Australian beef, Hanwoo should reduce its production cost.  Also, they emphasize that promoting the distinctiveness, sanitation, and safety of Hanwoo is important to encourage Hanwoo consumption.

9 More Dogs Infected by AI…AI Causes 190 Billion Won Damage [Korean, KSY]

http://www.etoday.co.kr/news/section/newsview.php?idxno=893371

SUMMARY:  Ministry of Agriculture, Food, and Rural Affairs (MAFRA), announced on the 31^st that avian influenza (AI) antibody was found in 9 dogs (3 from Anseong, 2 from Cheonan, 3 from Naju, and 1 from Buyeo).  MAFRA also announced that the estimated damage from the AI is a total of 190 billion won.  114.5 billion won from the total estimate will be spent on culling compensation.  11.87 million poultry from 472 farms have been culled until March 31^st, and 124,000 more from 3 farms will be culled.

South Korea to Export Samgyetang and Smoked Duck to the US [Korean, KSY]

http://news.kukinews.com/article/view.asp?page=1&gCode=kmi&arcid=0008174937&cp=nv

SUMMARY:  South Korea will export processed poultry products including “Samgyetang (chicken ginseng soup)” to the United States for the first time in 15 years.  The United States refused to import Korean poultry since 1999 because of the insufficient sanitary and disease control.  However, on the 26^th, Ministry of Agriculture, Food, and Agricultural Affairs (MAFRA) announced that U.S. Department of Agriculture allowed import of Korean processed poultry products.  The law will be enforced after 60 days of promulgation.  Korean export of fresh poultry meat is still restricted due to the ongoing avian influenza outbreak.

Excessive Supply and Decreased Demand in Milk [Korean, KSY]

http://www.nongmin.com/article/ar_detail.htm?ar_id=230097&subMenu=articletotal

http://w3.sbs.co.kr/news/newsEndPage.do?news_id=N1002311732

SUMMARY:  The production of raw milk is increasing while the demand is decreasing.  According to Korea Dairy Committee, production of raw milk each day from January to February rose 5.4% to 5,921 tons due to warm winter.  However, milk consumption declined 3.8% to 4,685 tons during the same period.  Dairy farmers insist that rise in price, increase in import, obligatory holidays for supermarkets, and skepticism about milk all negatively influenced the milk consumption.  The committee predicts the total production will be around 2.15 million tons to 2.22 million tons while total consumption will be about 1.91 million tons.  The oversupply will reach 275,000 tons.  To handle the excessive supply, the production of pasteurized milk has been enlarged by 30%.  Powdered milk is produced with the remaining milk.  The inventory of powdered milk recorded 11,500 tons, which is the biggest in 6 years and doubled amount compared to 4 years ago.  The price of milk is discounted up to 20%.  However, the concerns are rising because the problem is related to ever-declining milk consumption.  Dairy farmers demand for promotion of milk and expanded milk export to South East Asia.

Australian Ambassador “Australian Beef Does Not Compete Directly with Hanwoo” [Korean, KSY]

http://www.mt.co.kr/view/mtview.php?type=1&no=2014032514163028829&outlink=1

SUMMARY:  William Paterson, Australian Ambassador to South Korea, said that Australian beef does not compete directly with Hanwoo because the two have different segments in the market.  In the luncheon meeting on the 25^th, Ambassador Paterson said that Australian beef actually competes with the US beef in the Korean market.  He added that the price of Australian beef is a quarter to that of Hanwoo, which provides more consumers with more choices of high quality yet low price beef.  The Ambassador also mentioned that he is aware of the concerns rising from Korean livestock industry.  He is working to solve this problem, and planning to meet Hanwoo Association on the 26^th.  With Korea-Australia Free Trade Agreement (KAFTA) expected to be officially signed on May 8^th during the Prime Minister Tony Abbott’s visit to South Korea, Ambassador Paterson hopes that KAFTA will enter into force by the end of this year.

5. NORTH KOREA ISSUES

North Korea Reports Additional Foot-and-Mouth Disease Outbreak to OIE [Korean, KSY]

http://news1.kr/articles/1602777

SUMMARY:  Ministry of Agriculture, Food, and Agricultural Affairs (MAFRA) announced on the 26^th that North Korea reported additional outbreak of foot-and-mouth disease to World Organization for Animal Health (OIE).  North Korea reported that it culled 6 out of 729 pigs in the farm located in Pyongyang on January 16^th.  MAFRA is vaccinating pigs and disinfecting the farms in the border regions of northern Gyeonggi and Gangwon Province.  The Ministry has also designated a special disease control period from last October to this May and provided vaccines to all cow and pig farms.