EU May Reconsider Zero-Duty Rice Imports, Enjoyed by Cambodia, Myanmar

[geovalin]

Italy is looking closely at the European Union’s (EU) zero-import duty status extended toward Least Developed Countries (LDCs) – such as Cambodia and Myanmar – under the Everything But Arms (EBA) agreement designed to aid economic development in these Southeast Asian countries. This is according to reputable local media. Local sources tell Oryza that what makes the recent investigation into the zero-import duty status extended to LDC nations is the determination and solidarity of the Italian rice sector which feels it is under serious competition from duty-free rice imports.

This follows a previous request on December 16-17 when the Italian delegation expressed its dismay at a meeting on Agriculture and Fisheries held by the Council of the EU, and it was supported by Bulgaria, Greece, Spain, France, and Portugal. The Italian delegation said the EU rice sector is facing increased competition from rice imports, from Least Developed Countries (LDCs) and other countries with which the EU has trade agreements. The goal is to change zero duty import conditions, since these are deeply affecting European rice sector, from farmers to millers, according to local sources. The European regulation states, about “Safeguard measures”, claimed by European farmers and millers, that they may be taken "when quotations or prices on the world market reach a level that disrupts or threatens to disrupt the availability of supply on the Community market and where that situation is likely to continue and deteriorate, or if, due to imports or exports, the Community market is affected by, or is threatened with, serious disturbance.”

The Italian rice growing sector is monitoring EU rice imports not only from Cambodia, but also from other LDC countries, particularly Myanmar, which has enjoyed zero-import duties since June 2013. The alarm comes from Ente Risi, the Italian agency for rice. In the month of February 2014 alone, Myanmar’s rice imports to the EU reached about 3,760 tons, nearly the total the EU imported from Myanmar in 2013 - 4,600 tons.

Local sources tell Oryza that Ente Risi says the concern is how much bigger the zero-import duty tonnage could increase in the coming months in years; this especially likely if there remains a large gap between Italian rice prices and Asian rice export prices. Ente Risi fears that an influx of cheaper Asian rice imports will reduce rice production in Italy, Europe’s largest producer, endangering a piece of the nation’s heritage.

The rice imported from LDCs is Indica rice and Ente Risi data shows that indica rice stocks are up, while Italian deliveries to the EU are down and Italian Indica rice acreage is shrinking. On 11 March, Indica paddy stocks reached 244,000 tons, up 73,000 tons from year ago. Deliveries of Italian rice in EU in the first four months of this trade year, starting in September, are down about 19,000 tons - 14,000 of which are Italian Indica rice. Italian acreage in 2014, as confirmed by a Ente Risi survey, is expected to shrink about 16,000 hecatares, resulting in a loss of local paddy availability and profit for millers.

Ente Risi points out that the market is expecting more rice imports. EU import licenses for milled rice in 2014 have so far reached 321,000 tons, 73,000 tons, up about 29% from this time a year ago. Almost 18,000 tons were issued in the past week alone. For the whole year, EU rice import licenses for milled rice are expected to reach 610,000 tons, (up 25% from 487,000 tons last year). Ente Risi fears this could have for sure serious consequences for rice production in Italy and in the whole European Community.

http://oryza.com/news/rice-news/eu-may-reconsider-zero-duty-rice-imports-enjoyed-cambodia-myanmar