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Meat New Zealand snaps at Japan's snapback

Meat New Zealand CEO Mark Jeffries said today that Japan has acted against the spirit of the WTO in increasing tariffs on imported chilled beef from 38.5% to 50%. "The snapback will hit farmers and exporters to the tune of $2.4 million." Jeffries said.

"We are extremely disappointed that Japan has taken this action despite strong lobbying from the New Zealand, Australian, Canadian and US Governments." Jeffries said. "It serves as a reminder for our government of exactly the type of trade protectionist behaviour we are aiming to eliminate through the upcoming WTO ministerial meeting in Cancun, Mexico."

The so-called 'snapback' provision kicks in when Japan's cumulative quarterly increase in imports exceeds 17%, which they have just done for chilled beef in the April-June 2003 quarter. Jeffries said the increased imports come as the Japanese beef market recovers from the slump caused by discovery of BSE in Japanese cattle herds in late 2001.

"The mechanism was intended to protect Japanese producers against surges of imported product." Jeffries said. "They were not meant to use it where the market is simply recovering from a consumption drop as a result of the BSE scare." Jeffries pointed out that the trigger level for chilled beef imports is 31% below pre-BSE import levels.

"Analysis clearly shows that Japanese producers are not being harmed by the import recovery, and the snapback will only serve to disadvantage consumers." Jeffries said.

Meat New Zealand is concerned that the Japanese snapback could soon apply to frozen beef too, as imports continue to rise as recovery continues. Frozen beef imports for the April-June quarter were just under the trigger level.

The 50% tariff on chilled beef will be introduced from 1 August, and will remain in place until 31 March 2004, when it will return to 38.5%.

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