FAS Weekly Attache Report Digest
March 22, 2003

CROATIA, March 13, 2003 -- Poultry production and consumption have risen in recent years and are expected to continue to grow. Croatia has a domestic surplus of poultry meat but there is negligible domestic production of mechanically deboned meat (MDM) to supply the growing domestic meat processing industry. Unfortunately, U.S. suppliers are being shut out of the MDM market due to EU-related phytosanitary restrictions.

CROATIA, March 13, 2003 -- In 2002, Croatia imported 9,814 tons of rice with a total market value of approximately $4-5 million U.S. dollars. Officially, U.S. exports accounted for less then 2% of this market. However, significant levels of U.S. rice are transshipped from mills in the European Union. This report contains information on trade, importers, and tariffs.

AUSTRALIA, March 13, 2003 -- Australia's 2003/04 grain crops are expected to rebound sharply from the drought-reduced levels registered in 2002/03. Wheat production in 2003/04 is projected at 24 MMT, the second highest level on record and 14 MMT higher than in 2002/03. Attaining these 2003/04 production forecasts is contingent on a continued breakdown in the dry weather pattern that has characterized much of the Australian continent for over one year. Particularly critical will be precipitation over the next month or two that will be necessary for planting and establishing the 2003/04 winter grain crop. Higher expected grain availability in 2003/04 will allow grain stocks and exports to rise sharply from the levels that characterized 2002/03.

PAKISTAN, March 13, 2003 -- Pakistan’s MY 2003/04 wheat production is forecast at 19 Million Metric Tons (MMT), assisted by widespread rains throughout the country in February 2003, and by an increased usage of fertilizer and herbicide inputs. Even with a large draw down in the government held stocks, the country is forecast to import 1.5 MMT. The GSM- 102 program should help the U.S. remain competitive in the important soft white wheat market. Pakistan’s MY 2003/04 rice crop is forecast at 4.5 MMT, another strong showing for this major rice exporting country. Exports are forecast at 1.6 MMT.

EGYPT, March 13, 2003 -- Egypt's total wheat imports are expected to decrease by 10 percent during MY 2002/03. U.S wheat exports are likely to lose 65 percent of their market share to non -traditional suppliers this year due to high US prices and ample supplies of low-priced wheat from the Black Sea Region. Egypt's total corn imports are expected to decrease by 25 percent due to the devaluation of the Egyptian pound. However, US yellow corn exports are expected continue dominating the market this year.

ARGENTINA, March 13, 2003 -- Argentine exports of wheat and corn during November 2002

ARGENTINA, March 13, 2003 -- Argentine exports of wheat and corn during December 2002

ARGENTINA, March 13, 2003 -- Argentine exports of oilseeds, meal and oil during November 2002

ARGENTINA, March 13, 2003 -- Argentine exports of oilseeds, meal and oil during December 2002

COLOMBIA, March 13, 2003 -- Colombia continues to a large importer of corn and wheat, with corn imports from the US projected at 1.78 million tons for 2002/03 and US wheat imports projected at 680,000 tons. Rising world prices have resulted in lower duties under the Andean Pact price band system. Colombia authorized rice imports from other Andean Pact countries of 150,000 tons (mainly Ecuador) for the period March 15 to June 15. Ecuador reportedly may not be able to supply the full amount needed, which could open the opportunity for US rice imports.

BULGARIA, March 13, 2003 -- The Bulgarian tree nuts market has grown from practically non-existent prior to 1997 to a value of $8 million or 15,000 MT in 2001/2002 due to the dynamic development of the food service and retail sectors. Total U.S. tree nut exports to Bulgaria in 2002 exceeded $1.1 million, mainly in California raw almonds. Prospects for further growth in 2003 are good, but closely related to disposable consumer income.

EUROPEAN UNION, March 14, 2003 -- The EU's Special Committee on Agriculture did not agree on a mandate to open Article XXVIII negotiations to remove the current Margin of Preference system for setting rice import duties.

THAILAND, March 14, 2003 -- Export prices declined slightly in response to increasing supplies of new crop.

EUROPEAN UNION, March 14, 2003 -- This weekly report contains data on rice prices in the U.S., Thailand and the EU. It also lists current import duties and export subsidies in the EU. All information will be published as such in the weekly USDA publication "Rice Market News".

EUROPEAN UNION, March 14, 2003 -- A proposal to harmonize nutrition and health claims in the European Union is close to being finalized. The main point of discussion is how to manage the approval of claims

SOUTH AFRICA, REPUBLIC OF, March 14, 2003 -- Adverse weather forced us to cut the 2002 commercial corn crop estimate to about 8.5 million tons compared to the 9.1 million ton delivered from the 2001 crop. The total crop estimate, including farm retentions and the crop in the developing sector thus reverts to 9.2 million tons after about 9.8 million tons were produced in the previous season. This will be more than sufficient to supply local and export demand. The wheat situation remains unchanged.

BRAZIL, March 14, 2003 -- The boom continues! Brazilian soybean production and exports after a remarkable 2002 crop are headed to new heights with the 2003 harvest now under way. Blessed with high international market prices and a strong US Dollar, Brazilian producers have been propelled to plant as much soybeans as possible. After a few years of decline, cottonseed production will recover slightly in 2003, and the outlook for 2004 is for an expansion in both crops.

SOUTH AFRICA, REPUBLIC OF, March 17, 2003 -- This report updates the 2003 Annual Macadamia Report with data on a wet-in-shell (WIS) basis. South Africa's total CY2003 macadamia crop is estimated at 14,000 tons WIS (3,100 kernel tons), about 22% increase from 2002 because of good soil moisture content, favorable temperatures, and increased bearing trees. The macadamia industry plans to be regulated under the Agricultural Products Standards Act to ensure discipline for chemical residues. The industry is benefiting from a 5 million Euro subsidy for pest control to adapt to changes in chemical rules in the EU.

PHILIPPINES, March 17, 2003 -- Agriculture Secretary Luis P. Lorenzo, Jr. issued Administrative Order No. 7 (AO 7) February 20, 2003, providing the implementing rules and regulations (IRRs) of the Philippine Plant Variety Protection Act (PVPA) of 2002. The IRRs will take effect on April 2, 2003.

MEXICO, March 13, 2003 -- DRY BEAN BAN IS NOT POLITICAL, ASSURED SAGARPA*“RENEGOTIATING NAFTA BRINGS ABOUT CHAOS”*CAP CLAIMS U.S. EMBASSY OFFICIALS USED THREATS AGAINST FARMING GROUPS*TRQS ON EGMONT CHEESE*MEXICAN CUSTOMS ASKED TO STEP UP INSPECTIONS*SECRETARY OF THE ECONOMY SEEK SIDE AGREEMENTS*“MEXICAN BEAN EXPORTS HELD HOSTAGE”*CNA ALSO WANTS NAFTA SIDE AGREEMENT*“ITS TIME FOR THE RURAL SECTOR”*NATIONAL AGRICULTURAL DIALOGUE DISCUSSION ROUND SUMMARY*MEXICAN DIET NOT FAR FROM HARVARD UNIVERSITY’S*MEXICO’S TOURISM SECTOR ON THE UP AND UP*AGRICULTURAL DIALOGUE CULMINATES WITH NAFTA DISCUSSION*NAFTA PARTNERS WILL DISCUSS AGRICULTURE IN MONTREAL*INDIGENOUS COMMUNITIES IN FAVOR OF NAFTA RENEGOTIATIONS*

MEXICO, March 14, 2003 -- NO SURPRISES FOR THE NATIONAL FARMLAND AGREEMENT*“MEXICO: AN EXPORTING POWERHOUSE”*GOM NOT KEEN ON NEW BIOTERRORISM & BIO-SAFETY LAWS*ACCORDING TO SAGARPA, U.S. HAS MORE SUBSIDIES*“DISCUSSIONS WERE A WASTE OF TIME”*SAGARPA WILL LIFT MORATORIUM ON BT CORN RESEARCH*CNA ADOPTS USDA’S ‘5-A DAY’*GOM IS TO BLAME*LESS WATER PER PERSON*SECRETARY USABIAGA PLAYED DOWN DEFICIT*SUGARCANE FARMERS ASK FOX FOR HELP*NATIONAL AGRICULTURAL DIALOGUE NOT OVER*ACCORDING TO EXPERTS, AMENDMENTS ARE POSSIBLE*MIRROR LEGISLATION PROPOSED BY THE PRI*FARMING GROUPS DISCUSS NATIONAL AGRICULTURAL PACT*MEXICAN RESTAURANT INDUSTRY HURTING*“AGRICULTURE STILL POLITICIZED:” PRESIDENT FOX*NATIONAL AGRICULTURAL DIALOGUES: A SUCCESS*APPAREL INDUSTRY IN MEXICO IS PRO NAFTA

MEXICO, March 13, 2003 -- SECRETARY OF THE ECONOMY UPHOLDS NAFTA*NAFTA: THE SCAPEGOAT OF ALL OF MEXICO’S AGRICULTURAL PROBLEMS*MEXICAN AVOCADOS REACH RECORD-LEVEL HIGHS*“THE FARMLAND CAN’T STAND ANYMORE” WANT CORN AND BEANS EXCLUDED FROM NAFTA*FOX AND CHRETIEN CELEBRATE NAFTA BENEFITS AND THE FUTURE OF THE FTAA*NEW CERTIFICATE OF ORIGIN FOR ALL MEAT AND MEAT PRODUCT IMPORTS*WHAT ARE THE ACTUAL BENEFITS ATTAINED BY NAFTA?*“ELECTRICITY RATES ARE TOO HIGH FOR IRRIGATION PUMPS”*MEXICO PREPARES FOR NEW BIOTERRORISM FOOD SECURITY LAWS*SMALLER FARMERS CAN ALSO REAP THE BENEFITS OF NAFTA*“MEXICAN RURAL SECTOR IS IN A STATE OF EMERGENCY”*SRA NEEDS BETTER RESTRUCTURING* FOX PROTECTS NAFTA AND MEXICAN AGRICULTURE*CNG LOOKS TO NEGOTIATE OUTSIDE OF NAFTA* “I HAVE ALWAYS BEEN A SUPPORTER”: PRESIDENT FOX*CAP THREATENS NOT TO SIGN NATIONAL AGRICULTURAL PACT*MEXICAN BUSINESS LEADERS FEAR SCATHING U.S. RESPONSE*FREE TRADE AGREEMENT MEXICO-JAPAN*FARMING GROUPS ARE GETTING GREEDY*

EUROPEAN UNION, March 18, 2003 -- On March 12, 2003, the European Commission adopted a Decision to open an examination procedure in response to a complaint by the European Oilseed Alliance (EOA) about US soybean subsidies.

BURMA, March 19, 2003 -- Burma's lingering financial turmoil stymies agricultural traders as cash money dries up due to bank withdrawal limits.

EUROPEAN UNION, March 19, 2003 -- The European Commission recently approved a 30 million EUR program designed to assist Kenya, Uganda and Tanzania implement fisheries' management measures on Lake Victoria.

HONG KONG, March 19, 2003 -- Hong Kong has been negotiating with China on a Closer Economic Partnership Arrangement (CEPA) with the PRC and establishing co-located customs and immigration facilities. These initiatives have raised some concerns related to Hong Kong's status as a separate customs territory and the potential impact on third country interests.

INDIA, March 19, 2003 -- *India signs preferential trade agreement with Afghanistan*, *Custom tariff bill gets parliament approval*, *Five million ton wheat missing from FCI warehouse*, *Fertilizer price hike rolled back*, *As Bt cotton fails, Andhra Pradesh state government promises relief*, *US demands greater access for agricultural goods*, *Ambassador visits the US pavilion at AAHAR 2003*, *Private sector grabs 60 percent share in seed business*.

DENMARK, March 19, 2003 -- 40,000 tons of Danish pig meat stored under EU supported Private Storage Aid are now being shipped to Japan.

NETHERLANDS, March 19, 2003 -- This report includes statistics only. The narrative will be sent very soon.

RUSSIAN FEDERATION, March 14, 2003 -- On January 23, 2003, the Russian Federation announced the creation of tariff rate quotas (TRQs) on beef and pork imports. The yearly TRQs were set at 450,000 MT for imports of pork and 420,000 MT for beef, though the pro rated 2003 quota will be 337,000 MT and 315,000 MT, respectively. Russian production of pork is forecast to increase by six percent in 2003, while beef production is forecast to fall by two percent. As domestic production is not forecast to be greater than the reduced level of imports, consumption of beef and pork is expected to fall in 2003.

EUROPEAN UNION, March 19, 2003 -- The European Parliament voted to accept proposals for targets for biofuels use in public transport of 2% in 2005 rising to 5.75% in 2010. However these targets are not compulsory as in the original proposals.

NETHERLANDS, March 14, 2003 -- So far positively diagnosed farms are only found in the center of The Netherlands. The Ministry of Agriculture is still fearing a second wave of outbreaks.

BELGIUM-LUXEMBOURG, March 19, 2003 -- In 2003, Belgian wood sales decreased slightly. Sales increase in construction and panel products greatly offset decrease in furniture and material handling sales. U.S. 2002 exports decreased 20 percent compared to 2001 while U.S. imports, of laminated panel products mainly, almost doubled compared to 2001.

ITALY, March 19, 2003 -- The Italian Hotel, Restaurant and Institution (HRI) sector is a lucrative and growing sector, which generated 22 billion Euros in 2002. The Italian Hotel sector is the second largest in the world after the United States, with 33,000 establishments throughout Italy. Italians are changing their eating habits, and in the past ten years have increased their consumption of food eaten outside of the home by 141 %.

CANADA, March 19, 2003 -- Cold Temperatures Raise Grape Grower Concerns * Canada Contributes C$500,000 to Developing Countries * North Dakota State's Alsen Wheat OK for Milling until July 31 * Wheat Growers Finger CWB * Canola Council Aims for Stable Production of 7 MMT

CHINA, PEOPLES REPUBLIC OF, March 19, 2003 -- The decline of import duties and corresponding growth of the Chinese wine market have created new opportunities for American producers. GAIN report CH3802 describes recent developments in China's wine market. This report outlines relevant major trade shows, importing companies, and additional sources of information for marketing wine in and around Shanghai.

BURMA, March 19, 2003 -- Burma exported 27,193 mt of beans and pulses in December, 2002, with India taking 90 percent of total exports. Black Matpe, Mung beans, and Tor Whole (Pidgeon pea) accounted for 90 percent of total exports.

BURMA, March 20, 2003 -- For January, Burma exported 43,840 metric tons of beans and pulses, with no border trade sales. India again took the majority of the exports, taking 84 percent.

BURMA, March 20, 2003 -- As February progressed, trade in beans and pulses began to collapse due to a cash crunch that hit traders hard. As the month progressed, a financial sector problem spilled over into the general market when bank withdrawals were severely limited. Traders could not get enough cash to facilitate normal trading and hurried to dump their bean and pulse stocks for cash, driving prices to the floor.

NIGERIA, March 20, 2003 -- Updated on March 15, 2003.

JAPAN, March 20, 2003 -- The U.S. maintained its market share of Japan's rice imports in JFY 2002 at 47.4 percent. Japan finalized a rice policy reform proposal which, if implemented as planned, could increase the efficiency of Japanese farmers and reduce prices. Food corn imports, however, may be reduced for 2003 due to a positive test for Starlink in U.S. shipments last December. BSE's impact on feed demand has been minimal, and should stabilize further as the livestock industry is returning to normal.

NIGERIA, March 20, 2003 -- On February 14, 2003, the Nigerian Customs Service issued circular no. 008/2003 which addresses under-invoicing of imported rice. The declaration states that the tariff for rice will be calculated based on $270.00/MT unless a lower amount has been authorized. It is not clear what the long term impact of this decision will be, however, combined with the high duty (effective rate of 110 percent), it is likely U.S. exports will be impacted. Currently, a shipment of Food for Progress rice is held up at the Lagos Tin Can port as the duty was not paid according to this new directive.

MOROCCO, March 20, 2003 -- Morocco's wheat and barley production is expected to be the highest since 1996, provided more rain comes during late March/April period. Traditional suppliers of wheat to Morocco have lost significant market share because of price competitive Eastern European wheat. Morocco is negotiating a free trade agreement with the U.S. and the grain sector is politically the most sensitive.

CHINA, PEOPLES REPUBLIC OF, March 18, 2003 -- On February 11, 2003, nine Chinese goverment departments jointly issued the "Circular on Implementing the Relevant Measures for Further Supporting the Development of China's Soybean Industry". The following is an UNOFFICIAL translation of the policy announcement.

PHILIPPINES, March 20, 2003 -- Exports of coconut oil (CNO) and copra meal in November 2002 declined by 70 and 74 percent, respectively, compared to their levels the previous year. CNO and copra meal prices were generally higher. There were no copra exports during the month.

SAUDI ARABIA, March 20, 2003 -- Saudi Arabian poultry production and import estimates for CY 2002 and CY 2003 remain unchanged since our 2002 Poultry Annual report. However, the Saudi Ministry of Commerce's recent requirement for Nutrofuran testing on Brazilian poultry meat has reportedly slowed down imports of Brazilian poultry meat to Saudi Arabia in recent weeks.

MALAYSIA, March 21, 2003 -- Growing domestic demand for soymeal resulted in a 20% increase in soybean imports in MY2001/02. Imports from the U.S. rose 24% and captured 34% of the Malaysian soybean import market. Argentina remained the top soybean supplier to Malaysia with a 44% market share. Canada continues to dominate the food-grade soybean market. The outlook for 2002/03 is bright. Malaysia's intake of U.S. soybean is expected to increase by at least 10 percent. Malaysia continues to lead the world as the largest producer of palm oil and palm kernel oil. With the recovery from biological stress, CPO production is expected to increase to 12.6 MMT in 2002/03.

THAILAND, March 21, 2003 -- The following is an unofficial translation of a newspaper story that appeared in the Thai-language press on Mon., Feb 24, 2003.

THAILAND, March 21, 2003 -- Export prices changed slightly. Thai rices will become more attractive against Vietnamese rices.

EUROPEAN UNION, March 21, 2003 -- This report concerns the first of two scientific opinions that will serve as the basis for a derogation on the ban on intra species recycling for fish. This ban was introduced in the new animal by-products legislation.

TURKEY, March 21, 2003 -- Turkish oilseed production is expected to return to historical levels in 2003 after a significant production increase in MY2002. Turkey continues to import large amounts of oilseeds, meal and oils for its large crushing and refining industries as well as for the poultry industry. Imports of U.S. soybeans and products continue to increase, but are off to a slow start in the current marketing year due to high prices. In addition, political and economic uncertainty in the region could dampen U.S. exports.

YUGOSLAVIA (>01/2001), March 21, 2003 -- The agricultural sector is one of the most important sectors of the Yugoslav economy. After a decade of war, and political instability, Yugoslavia is a democracy in transition. Political, economic and social reforms are underway. Robust sustained economic growth has helped this transition period significantly and agricultural imports and exports are on a rising trend. Yugoslavia is poised to play a significant role in the regional agricultural market of Central Europe due to its excellent climate conditions and long history of agricultural research.

MEXICO, March 19, 2003 -- MEXICO OFF TO A GREAT START IN 2003*NAFTA FINANCIALLY BINDS U.S. AND MEXICO*BORDERLINE INVESTMENT*NAFTA ASSURING MEXICAN TRADE SURPLUS*“NAFTA HAS MORE THAN DOUBLED MEXICAN AG-EXPORTS”*VACCINATING FRUIT* ENFORCEMENT LAX FOR DAIRY TRQ’S*U.S. CORN BENEFITS MEXICAN CATTLE FARMERS*NO CORN RENEGOTIATION*CONSENSUS BUILDING*UNTA CALLS FOR AMENDMENT OF ARTICLE 27*NO MORE FASCIST POLICY*“TAKE CORN OUT OF NAFTA”* “OPEN YOUR BORDERS LIKE YOU PROMISED”

MEXICO, March 18, 2003 -- As a result of the economic slowdown, Mexico’s total imports of grain and feed will likely increase only marginally in MY 2003/04. Production of rice, sorghum and dry beans is expected to increase slightly, while wheat and corn is expected to decline from last year’s harvest.

EUROPEAN UNION, March 21, 2003 -- This weekly report contains data on rice prices in the U.S., Thailand and the EU. It also lists current import duties and export subsidies in the EU. All information will be published as such in the weekly USDA publication "Rice Market News".

CZECH REPUBLIC, March 21, 2003 -- Domestic production of beans continues to decline and the Czech Republic is increasingly dependent on imported beans. Price is still a decisive factor and most bean imports come from low cost suppliers such as Ethiopia and China. There will be no change in the import tariff for beans when the Czech Republic joins the European Union in May 2004.

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