International Egg and Poultry Review - By the USDA's Agricultural Marketing Service - This is a weekly report looking at international developments concerning the poultry industry, this week looking at South Africa and WTO Agriculture Negotiations.

South Africa

On April 28, 2005, South Africa lifted the restrictions on most poultry imports from the U.S. The only remaining ineligible products are poultry trimmings, mince, mechanically recovered poultry meat and other anatomically unrecognizable cuts. South Africa had banned imports of raw poultry from the U.S. in February 2004, due to the detection of disease in the U.S.

South Africa imposed provisional anti-dumping duties on U.S. chicken parts (HS 0207.14 and 1602.32) in July 2000, after an investigation following a complaint by the South African poultry industry in 1999. The anti-dumping duties were reaffirmed in December 2000. The duties ranged from 209 percent to 357 percent.

The General Agreement on Tariffs and Trade (GATT) allows members to take a safeguard action to protect a specific domestic industry. Under the Uruguay Round of Agreements Act, approved in late 1994, antidumping measures are valid for five years and then must be reviewed. The sunset review determines whether revoking the order would be likely to lead to continuation or recurrence of dumping. If dumping is likely to resume, the anti-dumping duties can be extended for another three years.

Source: U.S. Trade Representative; U.S. International Trade Commission; South Africa International Trade Commission; U.S. International Trade Administration; USDA: Food Safety Inspection Service, Foreign Agricultural Service; FAO; news wires.

Mexico: Poultry Sector Creating A New Export Program

The Mexican Poultry Producers Association (UNA) held its 43rd Ordinary General Assembly on April 25-26, where the new President of UNA, Justo Lopez Hernandez, was introduced. Cesar de Anda, the outgoing President, announced the creation of an export program between UNA and the government.

The Secretariats of Economy and Agriculture signed an agreement with UNA during the event to create a competitiveness program (Aviexporta) for the poultry sector to prioritize the tasks necessary to consolidate and foster a major presence in the international market for this sector. According to de Anda, the program intends to increase exports by 25 percent within the next ten years and create 500,000 additional jobs. It was also announced that Mexico is working jointly with the United States and other countries to consolidate a World Poultry Organization.
Source: USDA/FAS Attache Report

WTO Agriculture Negotiations

The Doha free trade round, which aims to lower barriers to global commerce, was supposed to be concluded in 2004. Disagreements over subsidies and protected markets presented major obstacles which have stalled talks. In Geneva, the WTO agriculture talks had been suspended on April 19, 2005 after discussions came to an impasse. On May 4, 2005 ministers from about 30 countries continued talks in Paris. Trade ministers finally made a breakthrough on agriculture technicalities. Now the agreement must go to Geneva for formal confirmation by the full WTO, a group of 148 countries.

The agreement is a compromise between the EU and Brazil, leader of the Group of 20 (which includes major developing countries such as Brazil, India and South Africa). The dispute centered on the way that flatrate import duties should be converted into percentage tariffs, based on the value of the goods. Doha guidelines state that higher tariffs will get bigger cuts, so EU negotiators held out for lower percentages to limit European farmers' exposure to foreign competition as a result of the trade round.

Agricultural tariffs are based on quantities imported into ‘ad valorem’ equivalents (AVEs), i.e., tariffs based upon the price of the product. Ad valorem duties are in terms of the percentage value of the commodity and non-ad valorem or specific tariffs are per-unit based, such as dollars per kilogram.

AVE conversion has pitted the EU and G-10 countries (Japan, South Korea, Switzerland and other major importing countries) against the US, the Cairns Group of agricultural exporters and the G-20. The former groups make use of a large number of specific tariffs; these need to be converted to AVEs in order for countries to proceed with their work on the tiered tariff reduction formula (under which higher tariffs will be reduced more steeply). The G-20 group insisted on a tight formula for conversion while the EU insisted on flexibility in determining the methodology to be used.
Source: Bridges Weekly Trade News Digest, news wires.

To view the full report, including tables please click here

Source: USDA's Agricultural Marketing Service - 10th May 2005