AMBASSADOR ADDRESSES BEEF CONCERNS WITH AVA CHAIRMAN

UNCLAS SECTION 01 OF 03 SINGAPORE 000998

SIPDIS

SIPDIS
SENSITIVE

USDA FAS FOR OA, CMP/DLP, ITP/AAD, FSIS, AMS
USTR FOR AUSTR BWEISEL, EBRYAN, AND JJENSEN
TOKYO FOR AG MIN COUNSELOR PASS USDA TEAM
FWS AND OES FOR BCATES
MANILA FOR APHIS

E.O. 12958: N/A
TAGS: EAGR KFLU TBIO SENV ETRD ECON SN

SUBJECT: AMBASSADOR ADDRESSES BEEF CONCERNS WITH AVA CHAIRMAN

REF: A) Singapore 0928 B) Singapore 0818


1. (SBU) Summary. The Ambassador assured Agri-Food and
Veterinary Authority (AVA) Chairman KOH Poh Tiong and CEO Dr.
Chua Sin Bin that U.S. beef was safe in a March 24 meeting. She
said that Singapore's issues with quality control stemmed from
differing definitions of what constituted boneless beef under our
import agreement. AVA agreed to meet with USDA or industry
experts currently traveling in the region; the meeting is
scheduled for March 30. CEO Chua said that recent outbreaks of
Avian Influenza (AI) in Malaysia were having an effect on
Singapore's ability to source certain poultry and duck products.
Chairman Koh said that AVA needed to do more to encourage
consumption of liquid eggs to minimize the risk of further
disruptions to the food supply. In addition to the Ministry of
Health-led Indonesian AI Trilateral Project, AVA was exploring a
similar bilateral animal health-related project in nearby Batam
where several Singapore companies have invested in a special
economic zone. CEO Chua asked for USG support to lift its ban on
exports of Arowana Dragonfish, an endangered species. The
Ambassador called on Singapore to enhance its monitoring of
illegal Ramin timber shipments, another endangered species. CEO
Chua said that Singapore had recently strengthened its
protections in this area, including stiffer penalties. End
summary.

U.S. Beef
--------------


2. (SBU) During her March 24 courtesy call, the Ambassador
assured AVA Chairman Koh and CEO Chua that U.S. beef imports were
safe. She underscored that the USG took Singapore's concerns
with quality controls and safety very seriously, and expressed
her appreciation for the quiet and cooperative manner in which
AVA had dealt with these issues thus far. She noted that USDA
and industry were working closely with U.S. packers to ensure the
absolute minimum number of defects. The Ambassador suggested
that this issue was primarily definitional, i.e., it centered on
different interpretations of what are "boneless" beef cuts.
Noting that a team of experts from USDA was currently in the
region, the Ambassador offered, and Chairman Koh agreed, to
invite some of them to visit Singapore in order to resolve this
matter. She said that industry representatives also had offered
to meet with AVA. Chairman Koh said that it was important to
stay focused on working towards full compliance. He noted that
Singapore wanted U.S. beef in its market to enhance the diversity
of its food supply. Having the option of offering U.S. beef to
transiting ships and aircraft would further strengthen
Singapore's position as a regional food re-supply hub as well as
offer a wider market for U.S. product, he said; ensuring food
safety, however, was paramount. Comment: While AVA officers
generally accept that the bone fragments do not present a food
safety risk, Chairman Koh did cite safety as a concern. End
comment.


3. (SBU) As reported reftel, since Singapore lifted its ban on
U.S. beef January 17, AVA has identified soft-bone and skeletal
bone fragments in all six initial consignments. After the
Ambassador's meeting, AVA Deputy CEO Dr. CHEW Siang Thai informed
Agricultural Counselor on March 27 that Singapore had decided
not/not to reject entire shipments of beef, for now. AVA will
instead continue its practice of intensive inspection and piece-
by-piece rejection. Following up on the Ambassador's offer,
three USDA experts now plan travel to Singapore to meet with the
AVA March 30. Dr. Chew also agreed to a presentation by U.S.
Meat Export Federation's Kevin Smith. These presentations will
focus on the types of bone fragments the Singaporeans are
encountering, how the fragents arise in the cutting process, the
steps industry will take to limit fragment occurrence, and the
development of defect criteria for boneless beef.

Avian Influenza
--------------


4. (U) Asked how its neighbors' problems with AI were affecting
Singapore, CEO Chua said that AVA's decision to ban poultry
imports from Malaysia's Perak State following a recent outbreak

SINGAPORE 00000998 002 OF 003


there among backyard farms and a bird park affected 80 percent of
Singapore's normal live duck supply. Singapore had about a one-
month supply of locally-slaughtered ducks in cold storage, with
Malaysia's Johor State and imports from the United States and
Europe continuing to cover 20 percent of demand, he said. If the
ban persisted more than five or six weeks, however, Singapore
would have to look to the United States and Europe for additional
supply sources, he explained.

Indonesia - Avian Influenza Trilateral Project
-------------- -


5. (U) CEO Chua said that Singapore was engaging Indonesia on
several fronts to help it implement its national AI preparedness
plan, including the Singapore-proposed Avian Influenza Trilateral
Project in Indonesia's Tangerang Municipality (reftel B). He
said that AVA had begun exploring a similar, albeit smaller-scale
project focused on animal health and safety in nearby Batam
Island, where many Singapore companies have invested in a Special
Economic Zone.

Liquid Eggs
--------------


6. (U) Chairman Koh noted that, in order to help minimize AI's
ability to disrupt the food supply, AVA needed to do more to
persuade consumers to switch from fresh to liquid and powdered
eggs (Singapore's liquid egg consumption, primarily among
commercial users, is about two percent of total egg consumption
compared to about 30 percent in the United States). He observed,
however, that demand for fresh eggs was fairly price inelastic;
after AVA banned all imports of Malaysian eggs in response to AI
outbreaks there in 2004, consumers were willing to pay as much as
six times more for local and Australian eggs. Also attending the
meeting, Ag Counselor expressed his hope that AVA would soon
approve the U.S.'s first application to import fresh eggs from
Pennsylvania.

Arowana Dragonfish
--------------


7. (U) CEO Chua asked that the USG reconsider its ban on
Singapore exports of Arowana Dragonfish, an endangered species
protected under the Convention on International Trade in
Endangered Species (CITES) and the Environmental Protection Act.
CEO Chua explained that Singapore had been successful in captive-
breeding of Arowana and that it exported the fish to many other
countries (Singapore reportedly has a 25-percent global market
share for ornamental tropical fish). Singapore was the first
country to obtain CITES' certification to farm-raise Arowana, CEO
Chua said. AVA was introducing Arowana into Singapore's
reservoirs (where fishing is prohibited) to develop a domestic
wild population, and assisting neighboring countries with their
own conservation efforts, he explained.

Ramin Timber
--------------


8. (SBU) Noting that the U.S. ban on Arowana imports was one of
the issues Singapore wanted to discuss at the second annual Free
Trade Agreement (FTA) review in Washington March 30, the
Ambassador said that we would similarly raise our request that
Singapore do more to monitor and intercept illegal shipments of
Ramin timber, another endangered species. CEO Chua asserted that
Singapore was committed to combating trade in endangered species.
He noted that Singapore had recently enacted new legislation to
enhance such protections, including substantial increases in
fines and enhanced authority relevant to transshipped and transit
cargo (reported septel).


9. (SBU) Comment: Post appreciates Washington's assistance in
arranging the visit of the USDA experts on short notice. The
visit should help resolve our beef import issues with Singapore,
specifically by defining defect criteria in boneless beef cuts to
help AVA move away from its current zero-tolerance policy. AVA
is willing to talk, and has so far worked closely with USDA and
the Embassy to handle this matter discreetly and professionally.

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End comment.

HERBOLD