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1. March 2004 China Approves Imports Of GMO Soybeans Bush administration trade officials on February 23 welcomed the announcement that China’s Ministry of Agriculture (MOA) has completed its biotechnology regulatory review of Roundup Ready soybeans and two corn and two cotton products. "China’s decision to approve permanent safety certificates for several biotechnology crops is another positive step for trade between our two countries and demonstrates the Chinese government’s commitment to the WTO principle of using sound science to determine such issues," according to a joint statement by USDA Secretary Ann Veneman and U.S. Trade Representative Robert Zoellick. They said they will "continue to engage China on outstanding biotechnology issues to ensure that both American and Chinese farmers have access to this technology to increase agricultural productivity and to provide safe and wholesome products to consumers." This is the first permanent approval issued by China for imports of a food commodity produced through modern biotechnology, USTR said. China is expected to finalize the safety approvals for other biotechnology products in the near future, according to the U.S. Trade Representative’s office. "China’s decision to issue final safety certificates for Roundup Ready soybeans is good news for U.S. farmers, as well as for Chinese consumers who rely on imports of high quality soybeans to be processed into cooking oil and livestock feed," said American Soybean Association (ASA) President Ron Heck. "This action will help ensure a steady market for U.S. soybeans, while helping stabilize meat, fish, egg, and cooking oil prices for Chinese consumers." "In the past, ASA has expressed concern about the willingness of China’s regulatory agencies to repeatedly move the regulatory target for approval of Roundup Ready soybeans," Heck said. "So we are very pleased that [this] announcement actually comes well before the scheduled April 20 expiration of the interim safety certificate program." The MOA requirements state shipments of the GMO crops be accompanied by details of the contract, such as the buyer, intended processor, and information on any entities that will store the crop. In addition, China will require that shipments include documentation showing that the government of the country in which the crop was grown also has approved of the crop for sale in its market. This second requirement could prove troublesome for Brazil, which grows large volumes of GMO crops even though the Brazilian government has yet to formally approve these crops. Brazilian officials have sent an informal letter to China saying that GMO crops are being grown in Brazil, but it is not known whether this would be enough to satisfy China’s Ministry of Agriculture, whether Brazilian crops could enter China based on U.S. approvals, or whether Brazil would have to take formal steps to approve GMOs itself. Under the new system, MOA must approve GMO crops as safe before traders can apply for safety certificates and import the crops. APHIS Releases Asian Rust Risk Assessment Report USDA’s Animal and Plant Health Inspection Service (APHIS) released a report on the status of scientific evidence on risks associated with the introduction into the continental United States of soybean rust (SBR). Recent outbreaks of the Asian strain of soybean rust have occurred in South America, causing U.S. soybean producers to ask APHIS to re-evaluate the entry status of soybean grain, seed and meal from countries where the fungus is known to occur. The USDA document describes the current information available to APHIS, which will be used to form a risk assessment. The report’s "main conclusions" affecting commercial production and trade of soybean seed, grain and meal and the biological characteristics of Asian soybean rust:
Industry officials want USDA to maintain rigorous inspections and, if needed, a quarantine process to safeguard U.S. soybean production. Soybean rust is a fungal disease that inhibits plants from setting pods and results in significantly reduced soybean yields if not treated promptly and effectively. Farm-state lawmakers and industry officials say one component of a long-term strategy to combat the disease is for the United States to be prepared with new soybean hybrids that have more resistance to Asian soybean rust. In addition to asking Congress to appropriate more money to develop a resistant variety, soybean industry officials are encouraging EPA to be ready to issue emergency use permits that would allow producers to use the necessary fungicides in the event of an outbreak. An effort is also underway to make sure the appropriate fungicides are available in sufficient quantities, should an outbreak occur. Soy Complex Mostly Down On Lower Than Expected Exports And Profit-Taking The soy complex closed mostly lower February 26 reflecting disappointing export sales report, better prospects for rain in the South America and month-end profit taking. The lower forecast for Brazil’s crop will further tighten competitor supplies to be exported during the 2003-04 US marketing year and probably will also result in fewer Brazilian old-crop soybeans to compete against new-crop U.S. soybean exports. How much the reduction in Brazilian production tightens the world situation will depend on China’s demand for South American soybeans. Imports of South American soybean and products into the United States are possible but the trade questions whether Brazil can execute in a timely manner and whether U.S. consumers will buy Brazilian beans. Since it is unlikely that imports can make up for the expected shortfalls in U.S. soybean supplies much higher prices are expected as the markets ration. March bean futures closed down $2.11, finishing at $340.98 May was $1.10 lower, closing at $339.88 and July lost $1.10, ending at $333.81. March meal was down $4.96, closing at $304.79; May was $2.65 lower, finishing at $306.66; and July decreased $1.76 ending at $302.58. March oil closed $4.85 higher to finish at $750.67; May was up $1.54, closing at $742.07; and July gained $1.54, ending at $734.57.
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