* Says to protect rice markets with maximum tariffs under
* Expected duty of 300-500 pct likely to deter import surge
* But some farmers angry, fear move paves way for future
* Shift comes as WTO deal on quotas finishes at year-end
(Adds further comment from farmers, detail)
By Meeyoung Cho
SEOUL, July 18 South Korea will scrap caps on
rice imports from 2015, potentially opening up the politically
sensitive market to more imports from countries such as the
United States and China, in a move that has been fiercely
resisted by many farmers.
Seoul said steep tariffs would be used to protect its
farmers. While this is likely to prevent a short-term surge in
imports, farmers are worried that it could open the floodgates
to foreign sales down the line in a country where locally grown
rice has traditionally enjoyed almost mythical status.
Under pressure to open its markets, Seoul has little room
for manoeuvre over the issue with a 20-year-old World Trade
Organisation (WTO) agreement on import quotas expiring at the
end of 2014.
"The rice market will be protected by setting maximum
tariffs in accord with the WTO," agriculture minister Lee
Dong-phil said in a statement.
At a news briefing, he added that this level would be from
300-500 percent. That would bring prices for imported rice in
line with local grain.
Around 30 farmers gathered in front of a government complex
in Seoul to protest against the move, with an official from
left-wing farmers' group the Korean Peasants League saying
farmers should have been consulted more thoroughly.
The government has held a series of discussions with the
public on plans for its rice policy and some farmers have
accepted that change was inevitable, instead focusing on the
exact level of tariffs.
"We consider the switch to the tariff scheme for rice
unavoidable," said Son Jae-beom, secretary general of the Korean
Advanced Farmers Federation.
He said that tariffs should be at least 400 percent and that
the level should not be amended as part of any free trade deals
with other nations.
CHINA, UNITED STATES
Under the current WTO agreement, South Korea must buy
exactly 408,700 tonnes of foreign rice this year, or 9 percent
of its demand. The amount that must be purchased abroad has
gradually increased from 51,000 tonnes in 1995.
Under the new scheme, Seoul would still be required to
import at least 408,700 tonnes a year, with the higher tariff
rate charged on any imports beyond that, agriculture ministry
China usually accounts for at least half of total imports,
the United States for 20-30 percent and Thailand for 10-20
percent, government data shows.
Of the 159 WTO members, only South Korea and the Philippines
have tight controls on rice imports. The Korean government,
farmers and civic groups have been closely monitoring
negotiations between Manila and WTO members on the future of its
Opponents led by the left-wing farmer groups have said the
tariff would eventually fall via free trade deals, opening the
door to more imports and hitting domestic growers hard.
"We have many concerns about whether the duty can really
stay at 300-500 percent levels as the government now vows,
because the agriculture ministry's roles include not only
stabilising production but also helping provide food at low cost
for the country's people," a farmer said at a public
consultation in June.
Government officials have said that rice would be excluded
from any free trade agreements, with Agriculture Minister Lee
repeating that position on Friday
A free trade agreement between South Korea and the United
States took effect in March 15 last year, while Seoul has been
in talks with China on a similar deal and also wants to join the
Trans-Pacific Partnership trade pact.
To reassure farmers further, Lee said that a higher
emergency tariff could be introduced if imports suddenly spiked.
A pick up in imports has the potential to benefit Chinese
growers, who produce the glutinous Japonica variety of rice
preferred by Koreans and found in dishes such as bibimpap, a
spicy mixed rice meal with vegetables.
But a source at China's agriculture ministry has said the
country would focus on its own food security and would not
increase rice exports to South Korea even if caps were removed.
The United States also exports Japonica, although market
participants in South Korea said Chinese rice is closer in
flavour to locally grown grain.
South Korea aims to produce 4.15 million tonnes of rice in
the crop year that ends in October 2015, down 2 percent from a
year earlier as the number of rice fields shrinks, a government
official said in April. Its appetite for the grain is estimate
at 4.07 million tonnes during the crop year.
(Reporting by Meeyoung Cho; Additional reporting by Ju-min
Park, Christine Kim, Chris Lee in Seoul, Naveen Thukral in
Singapore and Niu Shuping in Beijing; Editing by Joseph Radford
and Ed Davies)