The announcement by U.S. Trade Representative Robert Zoellick and Agriculture Secretary Ann M. Veneman was one of several developments the week of Aug. 4 that indicate just how challenging the brave new world of agricultural export markets is proving to be.

Besides the dispute settlement request:

-- Chinese officials told U.S. representatives and those from Argentina and Brazil that it was imposing new restrictions on soy oil imports, citing phytosanitary problems in recent shipments. Quarantine authorities, known as the CIQ, reportedly have compiled a list of companies that could be blacklisted from future shipments.

-- Japan announced that it was increasing its import tax on U.S. beef following what it called a significant increase in imports. Secretary Veneman countered that the higher tax would impose a burden on Japanese consumers and U.S. cattlemen.

-- A group of senators wrote Zoellick urging him not to include tariff preference levels that would allow the use of Asian fabrics and yarns in the Central American Free Trade Agreement now being negotiated. The senators reminded Zoellick of their disappointment with the recent textile agreement that gave much higher quota levels to Vietnamese textile imports.

European Union officials have been arguing that it’s pointless for the United States to pursue its WTO case on agricultural biotechnology products because the EU intends to grant approval of some biotechnology products in 2003.

But after five years of endless talk and delaying tactics by the EU, Zoellick and Veneman say they want a WTO dispute panel to settle the issue once and for all.

“For five years, the EU has kept in place a ban on biotech approvals – a ban which is unsupported by the EU's own scientific studies,” said Zoellick. “This trade barrier harms farmers and consumers around the world by denying them the benefits of productive, nutritious and environmentally friendly biotech products.”

The EU recently adopted two new regulations that 1) require biotech products to be traced throughout the commercial chain and comply with certain labeling requirements and 2) provide new approval procedures for biotech food and feed products. Since neither lifts the illegal moratorium on biotech products, the U.S. will continue its challenge.

Although ostensibly aimed at phytosanitary problems, the Chinese restrictions may have more to do with limiting soy imports, which have doubled since the first of the year, trade sources say. Coming just a few weeks before its rules on genetically modified soybeans expire, some observers said the Chinese appear to have shifted from GMOs to quarantine issues to control imports.

e-mail: flaws@primediabusiness.com