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