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### Viewing cable 08BRASILIA1000, USDA UNDER SECRETARY KEENUM CO-CHAIRS 3RD U.S.-BRAZIL

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
08BRASILIA1000 | 2008-07-24 10:26 | 2011-07-11 00:00 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Embassy Brasilia

`

    VZCZCXRO4940
    RR RUEHRG
    DE RUEHBR #1000/01 2061026
    ZNR UUUUU ZZH
    R 241026Z JUL 08
    FM AMEMBASSY BRASILIA
    TO RUEHC/SECSTATE WASHDC 2163
    INFO RUEHRC/USDA FAS WASHDC
    RUEHSO/AMCONSUL SAO PAULO 2482
    RUEHRI/AMCONSUL RIO DE JANEIRO 6443
    RUEHRG/AMCONSUL RECIFE 8309

` `

    UNCLAS SECTION 01 OF 04 BRASILIA 001000

    SENSITIVE

    SIPDIS

    STATE FOR USAID
    USDA FFS USEC KEENUM
    USDA FAS/OA FOR MYOST & CJACKSON
    USDA FAS/OFSO FOR AREA DIRECTOR JBAILEY
    USDA FAS/OCRA FOR BZANIN
    USDA FAS/OSTO FOR JHAIN
    USDA FAS/OGA FOR RSCHWARZ & MDWYER
    USDA APHIS/IS DSHEESLEY
    USTR JMURPHY
    USTR KDUCKWORTH

    TOFAS 004 ADMIN

    E.O. 12958: N/A
    TAGS: EAGR ETRD BR
    SUBJECT: USDA UNDER SECRETARY KEENUM CO-CHAIRS 3RD U.S.-BRAZIL
    CONSULTATIVE COMMITTEE ON AGRICULTURE IN BRASILIA MAY 19-20

    ¶1. (SBU) SUMMARY:  Dr. Mark Keenum, USDA Under Secretary Farm and
    Foreign Agricultural Services co-chaired the 3rd U.S.-Brazil
    Consultative Committee on Agriculture in Brasilia May 19-20, 2008
    which was successful in expanding bilateral dialogue and in nudging
    the agricultural trade agenda with Brazil forward.  Under-Secretary
    Keenum's visit, which included meetings with major agribusiness
    representatives, also provided opportunities to counter unfavorable
    international press information linking the rise in world food
    prices to U.S. biofuels feedstock production.  END SUMMARY

    THE U.S.-BRAZIL CONSULTATIVE COMMITTEE ON AGRICULTURE

    ¶2. (SBU) The US-Brazil Consultative Committee on Agriculture (CCA)
    was the result of the initiatives of Presidents George W. Bush and
    Luiz Inacio Lula da Silva on the occasion of their first official
    meeting in June 2003, and established through an official document
    signed the same month by then USDA Secretary of Agriculture Ann M.
    Veneman and Brazilian Minister of Agriculture, Livestock and Food
    Supply (MAPA) Roberto Rodrigues.  The first plenary session of the
    CCA was held in March 2004 in Brasilia and the second meeting in
    September 2005 in Washington D.C. A CCA Mid-Term Review also took
    place in Washington in September 2004, and a meeting of the CCA
    Working Group on Multilateral Issues occurred in February 2006 in
    Brasilia.

    ¶3. (SBU) Following opening comments from Celio Porto, MAPA's
    Under-Secretary of International Relations for Agribusiness and USDA
    Under Secretary for Farm and Foreign Agricultural Services Keenum,
    the third meeting of the U.S.-Brazil Consultative Committee on
    Agriculture at the Brazilian Ministry of Agriculture, Livestock, and
    Food Supply (MAPA) quickly got down to more specific discussion of a
    range of bilateral issues, principally regarding market access
    requests of both countries. Michael Yost, Administrator of the
    Foreign Agricultural Service (FAS), and Dan Sheesley, Deputy
    Administrator for International Services, Animal and Plant Health
    Inspection Service (APHIS), also led U.S. delegation discussion
    during the meeting.

    DISCUSSION OF BRAZIL'S TOP PRIORITY MARKET ACCESS REQUESTS

    ¶4. (SBU) Brazil raised the status of its request to export fresh and
    frozen beef to the United States. MAPA noted that USDA had completed
    its risk analysis and expressed a keen interest in eventually
    shipping product under the U.S. WTO tariff rate quota for third
    countries. The U.S. Delegation recognized the importance of the
    issue to Brazil but also expressed concerns about Foot-and-Mouth
    Disease (FMD) and referred to FMD outbreaks that occurred in Brazil
    at inopportune points during the risk assessment process. The U.S.
    side acknowledged, however, that work on Brazil's request is again
    moving forward.

    ¶5. (SBU) MAPA officials also raised its interest in U.S. recognition
    of the state of Santa Catarina ("regionalization") for exports of
    beef and pork to the U.S. market, and expressed concern that after
    one year of official recognition of Santa Catarina as a FMD-free
    area without vaccination by the World Organization for Animal Health
    (OIE), no practical results have been achieved. The U.S. Delegation
    confirmed that the Animal and Plant Health Inspection Service
    (APHIS) had recently received additional required information from
    Brazil and that an APHIS technical visit to Santa Catarina was
    scheduled for June 9.

    ¶6. (SBU) MAPA renewed its interest in exporting poultry meat to the
    United States and clarified that the official Food Safety and
    Inspection Service (FSIS) questionnaire is being completed and is
    expected to be finished before technical sanitary and phytosanitary
    meetings scheduled between both countries occur in August 2008.

    ¶7. (SBU) MAPA discussed the long term efforts Brazil has invested in
    establishing the Anastrepha grandis pest free area in the Northeast
    region of Brazil, its impact on the local economy and hopes that the
    area would soon be expanded according to its official request
    previously submitted. The U.S. side explained that Brazil's request
    is being assessed under the new Quarantine 56 (Q56) process and a

    BRASILIA 00001000  002 OF 004

    result would come soon.  Note: official approval of expansion of
    this area was announced in early June.

    ¶8. (SBU) The Brazilian delegation also requested a reduction in the
    number of on site APHIS inspectors for Brazilian mango exports and
    the transfer of inspection responsibilities to Brazilian
    technicians. MAPA said it will send an official request for further
    training, required by APHIS, to facilitate its request. The
    Brazilian side expressed hope this all would occur in time for the
    upcoming harvest season. APHIS agreed to review this request
    expeditiously and said that further technical discussions are
    needed.

    ¶9. (SBU) MAPA asked for an update on the status of the Pest Risk
    Analysis (PRA) for Citrus latifolia (Tahitian lime) and stated that
    it would like to resubmit its earlier request in order to expand it
    to include tangerines, oranges and lemons. The U.S. delegation said
    this highly technical issue will be discussed at the August
    technical meetings noting that an official request needs to be sent
    to the USDA office in Brasilia.

    DISCUSSION OF THE UNITED STATES' TOP PRIORITY MARKET ACCESS REQUESTS

    ¶10. (SBU) Under Secretary Keenum made clear U.S. concerns that one
    year after receiving its controlled risk classification regarding
    Bovine Spongiform Encephalopathy (BSE) by the World Organization for
    Animal Health, Brazil has not opened its market to U.S. beef, beef
    products, and live cattle. He requested further discussions to
    determine the specific steps needed to export U.S. ruminants and
    ruminant products to Brazil consistent with OIE recommendations on
    BSE. MAPA indicated a need for additional information in order to
    start a detailed risk analysis. Brazil also stressed that equal
    consideration should cover the whole range of diseases in matters
    such as equivalence and regionalization. Note: innumerable
    interventions and demarches by the U.S. Embassy and top level USDA
    officials over the past year and a half have been unproductive.

    ¶11. (SBU) Dr. Keenum also expressed concern about restrictions
    regarding certain specified varieties of wheat and specific ports
    authorized to import wheat into Brazil. MAPA said its main concern
    is the introduction of quarantine (exotic) pests. MAPA noted that
    analysis of the specific U.S. request on wheat is in process, and
    that it will allow for recognition of new pest-free areas and
    approval of all wheat varieties. Officials added that publication of
    new requirements is expected to be completed by the end of 2008.

    ¶12. (SBU) Dr. Keenum expressed appreciation for the recent agreement
    on new sanitary conditions for shipping day old chicks and stated
    that he looks forward to the publication of the Normative
    Instruction in the official gazette of the Government of Brazil
    (equivalent of the Federal Register). MAPA clarified that it will be
    published soon, as it depends now only on administrative
    procedures.

    ¶13. (SBU) Administrator Yost requested an update on Brazil's
    requirement of an official consular stamp purchased from the
    Brazilian Embassy or Consulates in the United States for all
    sanitary and phytosanitary certificates for agricultural products.
    The continuing requirement for consular stamps for live animals,
    such as day old chicks, continues to be a trade irritant for U.S.
    exporters that increases costs and delays shipment. MAPA clarified
    that for animal products, a consular stamp is no longer required due
    to a modification in Brazilian legislation. They also said that
    through an administrative error in the regulation, the stamp
    requirement for live animals was not eliminated but that a proposal
    legally modifying administrative procedures is dependent on
    administrative procedures for sending the proposal of legal
    modification to the Brazilian National Congress.  Post discussed
    this issue recently with MAPA officials, who informed us that such a
    change in legislation does not need to go to Congress, but only to
    the President's office.  MAPA has not formalized the request yet.
    The U.S. Delegation requested a waiver for the consular stamp
    requirement until Brazil resolves this issue.

    BRASILIA 00001000  003 OF 004

    USDA PRESENTATION ON RISING WORLD FOOD PRICES

    ¶14. (SBU) Under Secretary Keenum gave a concise presentation about
    the causes of rising global food prices, touching on macroeconomic
    factors, market dynamics and specific policy measures. The
    presentation highlighted the situation for four commodities
    specifically: corn, soybeans, rice and wheat. MAPA also presented
    its interpretation and noted that its conclusions are similar to
    that of USDA.

    BRAZIL'S BIOFUELS PROGRAM AND REGULATORY PROCESS FOR ANIMAL PRODUCT
    IMPORTS

    ¶15. (SBU) MAPA gave a cogent presentation that covered Brazil's
    potential for all biofuels production, main production areas,
    expansion of sugarcane production, status of the ethanol industry
    and the role of flex-fuel vehicles. MAPA's analysis demonstrated
    that the Amazon region is inappropriate for sugarcane production due
    to logistical problems and agricultural growing conditions. MAPA
    argued that Brazilian agricultural area expansion will occur through
    a reduction in livestock area.

    ¶16. (SBU) MAPA also discussed in detail its regulatory process for
    approving imports of animal products and explained aspects of its
    organizational structure, highlighting details regarding MAPA's
    specific competencies as well as Brazilian legislation and
    procedures of risk analysis for importing animals and animal
    products.  Administrator Yost inquired if MAPA has any further
    concerns with USDA's economic analysis under its risk assessment
    process, an issue that Brazil raised during the World Trade
    Organization Sanitary and Phytosanitary (SPS) Committee Meeting in
    April 2008.  MAPA indicated they had no concerns.  APHIS asked how
    Brazil's SPS regulations are linked to SPS regulations implemented
    by Mercosur.  MAPA indicated that it implements its own regulations
    and follows international rules.

    COOPERATION IN INTERNATIONAL FORA

    ¶17. (SBU) USDA took the opportunity to promote the candidacy of Dr.
    Karen Hulebak for Chair of the Codex Alimentarius Commission. MAPA
    indicated its support, but duly noted that the Brazilian official
    position is coordinated by the Ministry of Foreign Affairs and
    involves other governmental agencies that participate in the
    inter-agency processes regarding Codex. MAPA said it would propose
    Dr. Hulebak's candidacy during inter-agency discussions on Codex.

    ¶18. (SBU) MAPA explained its concerns about geographic dispersion of
    Codex committees and proposed that they should all be hosted in a
    single location in order to facilitate participation by more
    countries. The Brazilian side said that it has the support of Latin
    American and Caribbean countries and requested U.S. support on the
    issue. Brazil also requested a meeting with the United States,
    Argentina, Canada and Mexico before the next meeting of the
    Inter-American Institute for Cooperation on Agriculture (IICA)
    Executive Committee scheduled for July 16th, 2008 in Costa Rica in
    order to discuss more optimal use of IICA resources. The United
    States said it would consider these recommendations.

    ¶19. (SBU) Administrator Yost expressed U.S. appreciation for the
    positions taken by Brazil in the recent May COP/MOP 4 meeting in
    Bonn, Germany, particularly with regard to liability and redress
    issues under the Cartagena Protocol. Both delegations agreed with
    the view that the Cartagena Protocol should not discourage
    biotechnology development nor result in trade restrictions.

    ¶20. (SBU) MAPA expressed concerns over the growing use of private
    standards in trade of agricultural products and the fact that these
    standards can be used to inhibit trade. MAPA asked the U.S. opinion
    regarding Argentina's proposal to establish a working group within
    the WTO SPS Committee to address this issue.  Administrator Yost
    informed MAPA that USTR is the lead on this issue for the U.S.
    Government.

    BRASILIA 00001000  004 OF 004

    CAPACITY BUILDING

    ¶21. (SBU) MAPA expressed interest in trade capacity training in the
    following areas: information exchange regarding pest risk analysis
    and plant quarantine procedures, alternative microbiological methods
    for analysis of meat products, and FSIS analysis methods for
    antibiotics detection in animal products.  MAPA indicated it would
    cover its expenses. USDA agreed to take these requests under
    consideration.

    NEXT STEPS ON SPS ISSUES AND THE NEXT CCA

    ¶22. (SBU) MAPA reconfirmed its earlier request that technical
    meetings with APHIS take place in Washington D.C. August 12-15 in
    order to discuss technical aspects of issues raised during the CCA
    meeting. MAPA also requested to meet with FSIS and FAS staff during
    this visit.  USDA tentatively agreed on the date and venue of the
    meeting and requested that a detailed agenda be sent to USDA
    representatives in Brasilia well in advance. Both delegations
    tentatively agreed the next CCA meeting should take place in
    Washington D.C. in September 2009.

    COMMENT

    ¶23. (SBU) Although MAPA was initially skeptical of the proposed
    agenda for the CCA during discussions earlier in May, the Brazilian
    side was very pleased with the outcome of the meeting and the fact
    that technical meetings in August had been agreed to.

    ¶24. (SBU) Under Secretary Keenum and Secretary Porto held a joint
    press conference and made very similar comments regarding the jump
    in world food prices, the actions of a number of major world food
    importers and exporters, and global criticism of biofuels programs.

    ¶25. (SBU) Under Secretary Keenum was interviewed by Brazil's leading
    business newspaper in Brasilia and while visiting with agricultural
    industry members in Sao Paulo earlier during his visit, all of which
    resulted in accurate accounts of developments regarding world food
    prices, the U.S. Farm Bill, the WTO Doha Round negotiations and the
    recent release of the WTO Appellate Body Report on Brazil's cotton
    case.

    SAO PAULO AND FIELD VISITS

    ¶26. (SBU) Prior to the CCA, Dr. Keenum met with a cross-section of
    industry leaders in the city of Sao Paulo, including the Brazilian
    Sugar and Ethanol Producers' Association (UNICA) and FIESP, the Sao
    Paulo State Federation of Industries.  Dr. Keenum also visited
    sugarcane/ethanol and coffee producing areas of Sao Paulo State and
    a large commercial farm in the state of Goias that produces
    soybeans, corn, coffee, wheat and cotton. Discussions largely
    focused on the state of Brazilian agribusiness, high global food
    prices, the U.S. Farm Bill and the WTO Doha Round.

    SOBEL

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