Asia wheat buyers fret even as US says gene-altered strain isolated

Mon Jun 17, 2013 1:02pm IST

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* Japan says no change in stance on U.S. wheat

* S.Korea millers: no plan to lift suspension

* Worries linger in China as it boosts imports

* Manila to "strictly evaluate" food imports

By Meeyoung Cho and Osamu Tsukimori

SEOUL/TOKYO, June 17 (Reuters) - Asian wheat buyers remain concerned U.S. imports could be tainted with genetically modified wheat even as U.S. government findings showed the discovery of an unapproved GMO strain in Oregon appeared to be an isolated incident.

Major importers Japan and South Korea will continue to shun U.S. white wheat, while worries lingered in China as the country steps up imports to build stockpiles.

Chicago wheat slid to a two-month low on Monday as the U.S. winter wheat harvest progressed, boosting supplies when demand remains weak on concerns over GMO wheat discovered sprouting on a farm in the Pacific Northwest.

The U.S. Department of Agriculture said in a statement on Friday that it had found no genetically modified seeds in any field it investigated beyond the original site, and "all information collected so far shows no indication" any biotech wheat was in the food chain.

"At this point, I think there's not going to be any change in particular," Toru Hisazome, in charge of grain trading at Japan's farm ministry, said on Monday in reference to Japan's ban on imports of U.S. western white wheat.

"The (U.S.) announcement is regarded as a temporary report rather than a final one, and I think this is not something we can make decisions on at this point."

Asia imports more than 40 million tonnes of wheat annually, almost a third of the global trade of 140-150 million tonnes. The bulk of the region's supplies come from the U.S., the world's biggest exporter, and Australia, the No. 2 supplier.

Japan was one of first nations to shun U.S. white wheat imports after the May 29 announcement on genetically engineered wheat.

BAN TO STAY

Flour millers in South Korea also said the USDA findings would not prompt them to lift their suspension on imports of both U.S. western white and soft white wheat, and that they were still waiting for the Korean government to unveil final test results.

"We don't plan to lift our ban based upon the U.S. report over the weekend," said a senior official at the Korea Flour Mills Industrial Association. "We want to wait until our food ministry's test results are out."

China remained worried about genetically engineered wheat as it emerges as a leading buyer of U.S. wheat, taking 1.5 million tonnes in the last few months after the domestic harvest was hit by untimely rains.

"We think it is normal that some mills have worries," said one industry official. "But it will not hurt imports of U.S. wheat as Chinese companies are interested in cheap soft red winter wheat, which is not grown in Oregon."

Authorities in the Philippines are on guard for genetically modified food imports, even though there is no ban on U.S. wheat.

"As of today, we have not imposed a ban on wheat imports from the U.S.," said Clarito Barron, director of the Bureau of Plant Industry in Manila.

"What we are doing is strictly implementing our policy of strict evaluation and assessment of any products to be imported in case they contain GMO."

The Philippines imports around 4 million tonnes of wheat a year, relying mainly on U.S. supply.

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