World Trade Situation and Policy Updates
EU delays implementation on wine labeling regulation until August 2000: On
October 1 (the expected date of implementation), the EU decided to delay EC Regulation 881/98 on "Traditional Terms." This is the second time the EU has delayed the initiative. When fully implemented, this regulation will restrict the use of commonly-used wine labeling terms that describe such characteristics as color. The EU has stated that the rule is intended to prevent consumers from being misled; however, the United States and other countries believe that the regulation is aimed at protecting EU producers from foreign competition and are concerned over the wider implications for other products, such as cheese. Also on October 1, USG officials had expressed concern in a meeting of the WTO TBT Committee that the Committee was not notified of this measure and therefore members were not provided with the opportunity to comment. The U.S. view was supported by Australia, Canada, Uruguay, Mexico, New Zealand, Argentina, and Chile.
Hurricane Irene damages Floridas fruit and vegetable industry. According to preliminary estimates from the Florida Fruit and Vegetable Association, Hurricane Irene caused approximately $80 to $100 million in farm damage in South Florida, the nations top producer of winter vegetables. Dade County was hit the hardest by Irene, with reported crop damage affecting tomatoes, sweet corn, cucumbers, green beans, eggplant, squash and zucchini due mainly to standing water on the fields. The hurricane also caused damage to Floridas citrus industry, which lost some trees to high water and strong winds in Indian River, Brevard and St. Lucie counties.
California Orange Crop To Rebound. Initial forecasts signal a strong recovery in Californias 1999/2000 orange production, which was devastated by freeze last year. The 1999/2000 orange crop (all varieties) in California is forecast to reach 2.28 million metric tons, recovering from the decade low output of 1.29 million tons in 1998/99. Production of the Navel variety, the key U.S. orange export, is forecast at 1.4 million tons, up 90 percent from last year. The initial 1999/2000 forecast for U.S. exports of oranges is 600,000 tons, valued at approximately $320 million. Exports in 1998/99 are forecast to be about 260,000 tons, with an associated value, though buoyed by decreased supply, of roughly $170 million. A return to normal production in 1999/2000 should increase exports by nearly $150 million and allow the United States to regain its position as the worlds largest exporter of fresh oranges.
FAS-funded pest project in Belize aimed at preserving access for fruits, vegetables, and other ag products. On August 25, 1999, pink hibiscus mealybug (PHM) was detected in a small area of Imperial County, California. Although PHM is found in many regions of the world (including the Caribbean and Mexico), and has been reported on over 215 genera of plants, several countries in Central America began introducing unnecessarily trade restrictive phytosanitary measures, such as bans, fumigation requirements and new quarantine requirements. Recently, an infestation of PHM was officially confirmed in Belize. APHIS believes that by consulting with the plant protection authorities and providing training on biocontrols for this pest, OIRSA, the regions phytosanitary organization, and the individual Central American governments will revoke their trade restrictive quarantine measures (preserving U.S. fruit, vegetable, and grain exports valued at $320 million) and adopt the pest management action plan best suited to helping their domestic producers. FAS has allocated funds under the Emerging Market Programs Technical Issue Resolution Fund to carry out a technical assistance program in Belize, with broader implications for other countries in the region. The first trip aimed at establishing biocontrols for PHM in Belize is scheduled for November 15, 1999.
Brazils government announces plan to increase coffee exports outside of export quota.
Brazilian officials announced on October 14, 1999, a plan to help the countrys soluble coffee sector. According to reports, the government will lend to the soluble industry 1 million bags (60-kilograms each) of old-crop government stocks in order to encourage soluble exports. In return, the soluble industry would pay back the coffee beans to the government over a 2-year period with coffee beans bought from the current crop. The soluble industry will be getting from stocks coffee that is nearly 20 years old, but suitable for soluble coffee; and in exchange the government will be getting newer, higher-quality stocks. However, soluble coffee exports are outside of the Association of Coffee Producing Countriess (ACPC) export quota system. Soluble coffee exports would provide added value to Brazil and it is estimated that this scheme would raise $120 million in export revenue for the soluble coffee industry in Brazil. Brazils local exporters of coffee have claimed that this plan would distort the domestic and world coffee markets and they are threatening to leave Brazils coffee policy council.